Tata Chem hopes govt will not change gas allocation norms

Last Updated: Sun, Jul 14, 2013 09:23 hrs

Tata Chemicals has expressed the hope that the government will not make any changes in the gas allocation norms to the fertiliser sector, following the steep hike in gas pricing, effective next April.

"We hope that the government does not make any changes in the priority allocation of gas to the fertiliser sector," Tata Chemicals MD R Mukundan said on the sidelines of a CII conference on industrial relations over the weekend here.

He said the government's plan to make gas prices competitive and thereby enhance domestic production is a "right move," adding that "we urge the government not to make changes in gas allocation to the fertiliser sector and also on the price front."

He also urged the government not to allocate gas to merchant power producers.

He, however, said the decision (to revise gas prices) will increase the fertiliser subsidy bill by a whopping Rs 21,000 crore annually.

Late June, the government had almost doubled the prices of natural gas, which will have a direct impact on the sectors like power, fertiliser, minerals and steel.

Besides, urea import prices will also be escalated and its availability would also come down sharply and any new production of urea will not happen, he said.

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