Moily raises bogey of 'import lobby', defends move to hike gas price

Petroleum minister M Veerappa Moily today said an ''import lobby'' in the country is blocking any decision that will help reduce India's $160 billion oil import bill by ''threatening'' the petroleum ministry.

''They don't want us to stop imports. There are some lobbies that are working on that. Every minister is threatened many a times. Every minister who occupies this position is threatened," he said.

Moily, who is under attack by CPI leader Gurudas Dasgupta for suggesting a hike in natural gas prices by 60 per cent, defended the move saying that investments have to be remunerative to be attractive.

He said the proposed price hike is part of an initiative to attract investments in the almost stagnant oil and gas exploration, which would help increase domestic production and reduce imports.

''We are floating in oil and gas in this country and we don't explore it. We put every obstruction not to do it. There is bureaucratic obstructions and delays.

''Also, there are other lobbies. They don't want us to stop imports,'' he said.

Moily, however, refused to name or identify anyone who may have directly or indirectly threatened the ministers.

''History will speak about it. It is for you to judge,'' he said, adding, oil imports will rise dramatically if domestic production is not incentivised through right pricing policy.

''This will work to the detriment of the country. We are challenged by the vagaries of international prices,'' he said.

The revision in natural gas prices was aimed at reviving investor confidence and attracting investments, he added.

''For the last 4-5 years, investor sentiment is not that high... We have to give right price, otherwise nobody will come. One well (in the ultra deepsea) may sometime cost in millions of dollars,'' he said.

Moily said he has made a proposal to the cabinet committee on economic affairs (CCEA) to raise domestic gas prices from the current $4.2 per million British thermal unit to $6.775 per mmBtu.

Moily said he will not be cowed down by any lobby and will continue to work for India's energy independence by 2030. ''I am not helpless. Any timid minister will not go forward... I have come here to strive hard for the sake of the country, to work for the country. If anybody thinks that decision making process in the oil sector will be prevented they are totally wrong,'' he said.

''After having dismantled many of the obstacles, it is in the national interest to go for aggressive exploration. Investors should also come. They should be attracted it is not done now,'' Moily said.

India spent a record $160 billion on import of oil last fiscal and the geographical progression is that imports are going up, he added.

He said the only option for the country is to raise domestic production of oil and gas by increased exploration.

About Dasgupta's allegations that the gas price hike was to benefit Reliance Industries Ltd (RIL), he said he and his ministry are open to any solution that will help the country to break the ''no-investment-no-production'' scenario.

''I had called him (Dasgupta) but he is not prepared to come for a discussion. But I can reassure Gurudas Dasgupta or whosoever is there in the market, all the criticism should be there, but it should not get personal,'' he said, adding that he was open to any suggestion of the CPI leader.

"More than 60 per cent of the natural gas in India is still produced by the public sector companies. Therefore, the allegation that the price is being revised for the benefit of the private sector is completely misconceived," Moily added.

RIL has been seeking an increase in gas prices to justify higher expenditure and improve gas output at its KG-D6 block off the Andhra coast.