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CPM backs govt on RIL pricing
Gas row: CPM backs govt on RIL pricing
The state government, which has been feeling the heart of the CPM movement for land distribution to the landless, on Tuesday got unexpected support from the Marxists-albeit indirectly – on its stand regarding pricing of gas to be produced by the Mukesh Ambani-led Reliance Industries (RIL) from the Krishna-Godavari basin. The CPM Politburo on Tuesday asked the Center to reject RIL’s “artificially inflated” price. The party asserted that pricing of natural resources such as gas should not be left to market forces and sought the intervention of the empowered committee of ministers. With this resolution the knotty matter will become more difficult to untie, what with the government hanging on the support of the Left parties.
It may be recalled that CM Y S Rajasekhara Reddy had so far written over 23 letters to the Center and has been insisting that the RIL proposal to sell gas at $4.33 per million British thermal unit was not justified. The CM would be making another presentation before the committee soon. He has already made one round of submission to the committee arguing that AP’s prosperity depends on gas at reasonable prices. The CPM resolution also comes as a shot in the arm of Mukesh’s younger brother Anil Ambani, the power industry and the fertilizer sector, all of whom have been demanding gas for their projects. The gas will start flowing in the middle of 2008. The CPM’s unexpected support comes as a sort of relief for the government, as per the past few months the two have been virtually at logger-heads over the Mudigonda firing and Bhooporatam agitation. According to sources, the state cabinet would meet on Wednesday and was likely to discuss the matter. The petroleum ministry’s line till now has been that companies had been promised a free pricing regime when they committed large outlays for searching for gas and therefore it was not right to change the norms at a later date.