A new report from the Comptroller Auditor General has turned the spotlight on Mukesh Ambani’s Reliance Industries. And the result isn’t flattering for either the company or the government. The CAG report has attacked the petroleum ministry and hydrocarbons regulator DGH. It says both of them allowed RIL to violate the terms of the production sharing contract for its KG D6 field. It also said the entire formula needed to be overhauled and that the country needed a truly independent regulator for the sector.
Currently companies have to share their revenues from oil or gas wells with the government. But that only happens after the well operator recovers its costs. CAG says that reduces the incentive to cut down the capital expenditure.
Shares of RIL meanwhile shrugged off the latest troubles, gaining 2.62% on the BSE to 853.50.
Food inflation has eased in late August. India’s food price index rose 9.55% in the week to 27 August. The previous week it climbed 10.05%.
Indian shares rallied once again on Thursday, with the Sensex reaching a one-month high. The gains came amid talk that the Reserve Bank wouldn’t hike rates when it meets again on 16 September. The Sensex shot up 101 points to 17,166. And the Nifty jumped 29 to 5,153.