Union Minister Nitin Gadkari today said Iran has offered natural gas supply at USD 2.95 for a urea plant being set up by India at Chabahar port, but that negotations were on to lower the rate.
Gadkari said India wants the supply at USD 1.5 per mmBtu rate, while Iran has offered it at USD 2.95.
"Now we are negotiating. The Prime Minister has set up a panel under my leadership to negotiate with Iran on lowering the rate for supplying gas. If they offer to supply gas at USD 1.5 per mmBtu rate, we will promise them Rs 1 lakh crore," he said.
Reports of all ministries concerned on developing Chabahar would be received in two or three days, after which he plans to visit that country for the talks to lower the rate, he said.
"In next two to three days, various ministries will give their reports (to develop Chabar port). After that we plan to visit Iran and meet government officials there," he said in an interaction with students of IIMB at the inauguration of 'Vista 2015' here.
With US and other western nations easing up on sanctions against Iran, India has been in talks with the Gulf nation to set up a gas-based urea plant at Chabahar and also develop a gas discovery made by ONGCBSE.
Gadkari pointed out that India imports about eight to nine million tonnes of urea and is negotiating for a price of $1.5 per mmBtu.If successful, it would see a steep decline in the country's Rs 80,000 crore urea subsidy, he said.
"You can understand if you are making urea with the cost of 15 dollars then you can imagine if it is made in 1.5 dollars what will be the cost? If we could be able to produce urea at the rate of 1.5 dollars we can save Rs 80,000 crore of the subsidy - we don't need to give it farmers. The cost of urea will be reduced by 50 per cent," he said.
India has already pledged investment of about USD 85 million to develop the port, which is off Iran's south eastern coast and which will provide India a sea-land access route to Afghanistan bypassing Pakistan.
Gadkari had visited Tehran in May and both nations had signed an agreement to develop Chabahar port. Iran's Foreign Minister Mohammad Javad Zarif had also called on Gadkari in August.
