Contrary to the widely held belief, the Union government did not cap the price of natural gas from the Krishna-Godavari basin. Instead, as reported in a story in Mint on Tuesday, it is actually a floor price. It was the government’s job to say that in the first place.
Unfortunately, the empowered group of ministers, which took the decision, hid more than it revealed on the pricing front (also see Page 22). That press release on the subject did not clarify a crucial part of the pricing formula gives credence to this view.
This silence was costly. It led to speculation that India was back to bad old behaviour of administering prices, raising alarm bells among foreign investors. That this newspaper’s report showed otherwise is cold comfort.
Natural gas demand in India is growing fast and the future of industries such as fertilizers and power depends on it. Price clarity is a must for their growth and the government has done little to help move towards that goal. It must do so now.