IGL hikes CNG price in NCR by Rs 2.90/kg

CNG price in the national capital and adjoining towns was hiked today by a steep Rs 2.90 per kg, the third increase this year.

Compressed natural gas (CNG) in Delhi will cost Rs 38.35 per kg with effect from midnight tonight, Indraprastha Gas Ltd , the sole retailer of CNG and piped natural gas in the national capital, said in a press statement here today.

Earlier the price was increased by Rs 1.75 per kg on January 1 and by Rs 1.90 per kg later on March 6.

IGL, which hiked price of CNG sold to automobiles in Noida, Greater Noida and Ghaziabad by Rs 3.30 per kg to Rs 43.10 per kg, said the increase was necessitated because of fall in value of rupee and rise in cost of imported gas.

The hike had been necessitated because IGL is buying more of imported liquefied natural gas (LNG) after supplies from Reliance Industries ' KG-D6 gas fields dried up. Imported fuel costs at least three times more than USD 4.20 per million British thermal unit rate fixed for domestic gas.

City gas distributors like IGL are not getting any supplies from KG-D6 since September last year, after a 40% output drop forced the government to cut supplies to non-priority sectors so that requirement of power and fertiliser plants can be fully met.

"IGL is constrained to announce increase in the price of CNG since the input cost of entire pool of natural gas has risen substantially since the last price revision due to appreciation of dollar vis-à-vis rupee up to 14% and the increased dependence on imported LNG," the company said.

In addition, there has been an increase in cost due to a massive hike of over 23% in electricity tariff and also in minimum wages announced by the government. 

IGL said this increase would have minor impact on the per km running cost of vehicles in Delhi.

"For autos, the increase would be 8 paisa per km, for taxi it would be 14 paisa per km and in case of buses, the increase would be 83 paisa per km, which translates to less than two paisa per passenger km," the statement added.

Textile debt recast meet on July 13 

Inter-ministerial panel to be constituted

A meeting of a Group of Officers will be held on July 13 in New Delhi to formulate debt restructuring proposals on a case-by-case basis for the textile industry.

In May, the Union Textile Minister, Anand Sharma, had announced that a debt restructuring package would be considered on a case-by-case basis by individual banks for the industry and that an inter-ministerial committee of senior officials would be constituted to co-ordinate with the industry and banks to expedite the restructuring.

The restructuring proposal included a two-year moratorium on term loans, a special provision in non-performing assets norms to avoid asset reclassification, and converting the working capital eroded into working capital term loans repayable over three-to-five years.

The Department of Financial Services sent a communication last month to the chairmen and managing directors of banks reiterating that banks should consider eligible stressed loan accounts in the textile sector where restructuring, including second restructuring, was required.

In a letter to the Union Ministry of Finance last month, the Reserve Bank of India (RBI) said that it had no objection to the proposal for a two-year moratorium on term loans, and conversion of working capital into working capital term loan. However, the case for asset classification benefit on second restructuring was not justified, it said. The meeting, on July 13, with representatives of the industry and banks will take up discussion on communications of the RBI and the Department of Financial Services.