An inter-ministerial panel in its draft report a few months back had suggested averaging out price of costlier imported LNG with cheaper domestic gas. But in its final report, it said, "The committee does not recommend pooling mechanism for natural gas at the overall level, nor does it recommend a price pooling on sectoral basis"
New Delhi: Reversing its earlier stand, a high-level government committee said that domestic natural gas users cannot be asked to subsidise costlier imported LNG as pooling of natural gas prices was not feasible, reports PTI.
An inter-ministerial panel headed by Planning Commission member Saumitra Chaudhuri in its draft report a few months back had suggested averaging out price of costlier imported LNG with cheaper domestic gas. The averaging out, called pooling of prices, would have resulted in users of cheaper domestic natural gas pay double the existing rates so that imported LNG could be sold at affordable rates.
But in its final report, which was prepared after extensive consultation with the industry, it said, "The committee does not recommend pooling mechanism for natural gas at the overall level, nor does it recommend a price pooling on sectoral basis."
Instead, the committee in its 25th August report said preferential allotment of domestic gas to be done to priority sectors of fertiliser and power only and the rest of the consumers like steel plants should be allocated imported LNG.
Domestic gas is currently priced at $4.2 to $5.5 per million metric British thermal unit (mmBtu) while the fuel imported in ships in its liquid form (liquefied natural gas or LNG) is priced at $10 to $14 per mmBtu.
"These (non-priority) users operate in a market environment where their output prices are market driven with no regulatory burden and hence they should be able to pass on the higher costs of gas feedstock," the report said.
State gas utility GAIL India and Petronet LNG, which were part of the inter-ministerial committee, had been lobbying for pooling of gas prices as LNG currently being imported on a long-term contract from Qatar will cost upward of $12 per mmBtu from 2014 while new contract with Australia was priced at $14.5 per mmBtu.
"The recommendation put forth here do not envisage any form of pooling at the all-India level cutting across industries," the report said.
"What it does is to preferentially allot available domestic natural gas to fertiliser and power sectors with a certain quantity reserved allotment for the city gas/CNG sector," it said.
The final report called for meeting incremental requirements of the two sectors and keeping usage of imported LNG in the priority sectors to not more than 25%.
Non-priority steel plants, oil refineries, petrochemical units presently consume about 18.4 million metric standard cubic meters per day (mmscmd) out of the total domestic gas availability of 110.59 mmscmd. Fertiliser and power sector draw 88.37 mmscmd.
Nifty to move in a range of 4,965 to 5,100
The Indian stock market snapped three-day gains and settled lower on the opening day of trading this week, following fresh worries over the global slowdown after dismal US jobs data announced at the weekend.
Although the Nifty made a lower high compared to Friday, the index managed to hold itself above Friday's low and higher than the 20-day moving average of 5,015. The fall was restrained, despite the huge volume of 64.23 crore shares on the NSE.
If the recent lows hold, we may see gains up to the level of 5,100 and 5,200. However, if the negative global developments continue, the fall could extend to 4,965.
Reflecting the negative trend in the Asian markets, following the dismal news from the US, the domestic market opened lower this morning. The Nifty resumed trade at 4,999, down 41 points, and the Sensex opened at 16,678, down 143 points. The early losses dragged all sectoral indices into the red.
The indices were range-bound for most of the morning session, but slipped to the day's lows in noon trade as selling pressure increased. At the lows, the Nifty was at 4,964 and the Sensex was down to 16,651.
However, a half-hearted recovery, aided by auto and realty stocks, pushed the market higher in the post-noon session. The benchmarks rose to their intra-day highs as the Nifty touched 5,030 and the Sensex 16,760.
Volatility persisted in late trade which resulted in the market closing off the day's highs. The Nifty ended the session at 5,017, down 23 points and the Sensex settled at 16,713, a decline of 108 points.
The advance-decline ratio on the National Stock Exchange (NSE) was 919:802.
The broader indices outperformed the Sensex today with the BSE Mid-cap index gaining 0.51% and the BSE Small-cap index rising 0.18%.
BSE Consumer Durables (up 2.44%), BSE Auto (up 1.30%), BSE Realty (up 0.81%), BSE Capital Goods (up 0.39%) and BSE Bankex (up 0.37%) were the top gainers in the sectoral space. The losers were led by BSE Oil & Gas (down 1.77%), BSE IT (down 1.44%), BSE TECk (down 1.06%), BSE Healthcare (down 0.66%) and BSE PSU (down 0.56%).
The top performers on the Sensex were Hero MotoCorp (up 5.16%), Jaiprakash Associates (up 4.20%), Bajaj Auto (up 2.74%), Jindal Steel (up 1.81%) and Tata Steel (up 1.26%). The key losers were Wipro (down 3.65%), ONGC (down 2.67%), Infosys (down 2.23%), Reliance Industries (down 2.05%) and Sterlite Industries (down 1.91%).
Hero MotoCorp (up 5.42%), Reliance Capital (up 5%), Reliance Infrastructure (up 4.73%), JP Associates (up 4.11%) and Axis Bank (up 3.67%) were the top Nifty gainers. Wipro, Cairn (down 4.02% each), HCL Technologies (down 3.15%), Ambuja Cement (down 2.65%) and Infosys (down 2.44%) settled at the bottom of the index.
Markets in Asia also settled in the negative on concerns following unchanged US non-farm payrolls for August. A defeat for German chancellor Angela Merkel's centre-right bloc in a regional election at the weekend and speculations of further monetary tightening in China added to the woes.
The Shanghai Composite tanked 1.96%, the Hang Seng tumbled 2.95%, the KLSE Composite declined by 0.74%, the Nikkei 225 fell by 1.86%, the Straits Times lost 2.46%, the Seoul Composite plunged 4.39% and the Taiwan Weighted fell 2.65%. Bucking the trend, the Jakarta Composite gained 0.64%.
Back home, foreign institutional investors were net buyers of stocks worth Rs1,158.38 crore on Friday. However, domestic institutional investors were net sellers of equities worth Rs346.28 crore.
Everonn Education continued to slide today, following the hammering last week after the arrest of its managing director P Kishore by the Central Bureau of Investigation in a bribery case. The Everonn stock closed at the lower circuit (down 19.99%) at Rs280.55 on the NSE.
Brooks Laboratories made a shaky debut on the bourses today, closing 38% down at Rs61.90 on the NSE, against its issue price of Rs100. The stock opened at Rs100 and traded in the range of Rs131.60 to Rs58.15. The initial public offer (IPO) was subscribed 1.6 times. The IPO got bids for 1.11 crore shares, compared with 70 lakh shares on offer. The company intends to use the funds for setting up a manufacturing unit in Gujarat, for working capital needs, general corporate purposes and to meet the issue expenses.
Suven Life Sciences has secured four product patents-three from Australia and one from New Zealand-corresponding to the New Chemical Entities (NCE) for the treatment of disorders associated with neurodegenerative diseases. These patents, which are valid through 2027, Suven has a total of 11 patents from Australia and 12 from New Zealand for the NCEs. These patents are exclusive intellectual property of Suven and are achieved through its internal discovery research efforts. The stock gained 3.29% to close at Rs17.25 on the NSE.
Hospital Cash plan guards against the erosion of policyholders' accumulated savings on account of medical bills by providing a fixed daily allowance to the insured person for every day of hospitalisation
SBI Life Insurance today announced a foray into the health insurance segment with the launch of its 'Hospital Cash' plan, which provides a fixed daily allowance to policyholders for each day of hospitalisation.
The Hospital Cash plan guards against the erosion of policyholders' accumulated savings on account of medical bills by providing a fixed daily allowance to the insured person for every day of hospitalisation, irrespective of the hospital bill amount, SBI Life said in a statement.
"Our foray into health insurance is aimed at addressing the issues of rising healthcare costs and acute under-penetration of health insurance in India," SBI Life MD & CEO M N Rao said.
The plan is available for a fixed policy term of three years and offers the flexibility of premium payment options, with collection on a yearly, half-yearly or quarterly basis. The cover can be renewed till the age of 75 years.
Hospital Cash's Daily Hospitalisation Cash Benefit (DHCB) provides policyholders with a 100 per cent fixed payout from the first day of hospitalisation without any deductions.
Furthermore, in case the insured person is admitted into an ICU, the amount receivable by the policyholder is twice that of the DHCB.
An additional fixed lumpsum of Rs 10,000 is payable to policyholders covering two or more family members under the plan in case the insured person is admitted to the ICU. The product would also be made available for subscription online.