Gas pricing formula committee chairman Kirit Parikh is optimistic that the Union Cabinet will approve the gas pricing recommendations put forth by his committee.

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Below is the verbatim transcript of his interview with CNBC-TV18.

Q: Are the other recommendations still up for approval? What's the latest?

A: I'm as ignorant about it as you are. Because I have no idea on how the government works. I'm not involved in this. I have been told that it will be approved sometime soon. And I do think that that should really help ONGC and Oil India as well. But let us see what happens. I have heard from people that yes, the cabinet is considering it, it's likely to be approved. But when it will be is anybody's guess.

Q: Even if it is approved at the next meeting, it can come into effect from April 1 with retrospective basis?

A: Personally I am against doing anything retroactively. That creates a bad feeling and a sense of uncertainty amongst investors, businessmen and others.

I think there is no sanctity about doing it always on the first.

Q: You're saying that what you've been told is that it was due to come up with the cabinet level for an approval? Would you know, that all the processes leading up to the cabinet, considering it had been completed? Had the ministry prepare a cabinet note, sent it up?

A: Yes, of course, if it goes to the cabinet, minister must have prepared everything. Because you don't waste cabinet’s time without full preparation.

Also Read | Shares of City Gas Distributors slide as they wait for a input price cap

Q: Would you be aware if all that has already happened. And at the next meeting, it could be taken up?

A: I'm 100 percent sure that it's all happened. Otherwise, it would not go to the cabinet. The second thing is that the committee had representatives from all ministries, and they've all signed it. So, I'm sure that taking the ministry’s consensus, etc., should not have been difficult. Of course, there is always issues which economists like us would not fully appreciate the political concerns. So there may be some issues, but I'm still hopeful that the government will accept the bulk of our recommendations.

Q: The heart of the recommendations, what you propose is broadly three fold. One is prices now to be linked to crude prices? Not international gas prices. Number two is there is a floor and there is a cap, a ceiling? And there is a there is a increase which is built in every year, right?

A: That is correct. And I should add one more. We have said that by January 1, 2027, everything should be market determined.

Q: Would you know when is the next cabinet scheduled to meet?

A: I have no idea.

Q: But you remain very hopeful and as you said perhaps there is no reason why it should not be accepted.

A: That is correct. I am quite hopeful that it will be accepted.

Also Read: Shares of City Gas Distributors slide as they wait for a input price cap

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First Published:Apr 3, 2023 12:04 PM IST