The Cabinet Committee on Economic Affairs (CCEA) postponed today the consideration of a proposal to hike natural gas prices by a steep 60 percent as Union Oil Minister M. Veerappa Moily was away on an official tour.
Moily's proposal to raise gas prices to USD 6.775 million British thermal unit (mmBtu) from current USD 4.2 mmBtu, which would result in a steep rise in electricity tariff, urea manufacturing cost as well as CNG rates, was listed for consideration of CCEA.
The CCEA, however, "deferred a decision", said a senior minister attending the meeting chaired by Prime Minister Manmohan Singh.
The Oil Ministry had moved a note for an across-the-board hike in gas prices for consideration of CCEA. However, with Moily in Tripura for the inauguration of ONGC's power plant by President Pranab Mukherjee, the CCEA deferred a decision.
The gas price hike, while triggering investment in gas hunt in the country and the resultant production hike, is being opposed in some quarters as it would lead to a rise in cost of generating electricity and urea production.
There is opposition to price hike , and there is speculation that the proposal may be referred to a ministerial panel for further deliberations.
