Thaindian News

New Delhi, Dec 30 (IANS) The price of compressed natural gas (CNG) will go up by Rs.1.75 a kg in Delhi and by Rs.2 in Noida, Greater Noida and Ghaziabad from midnight Friday following depreciation of the rupee against the dollar that has made the import of gas costlier.

Indraprastha Gas Ltd (IGL), sole distributor of CNG in the national capital region, said the gas will cost Rs.33.75 a kg in Delhi. In Ghaziabad, Noida and Greater Noida consumers will have to pay Rs.37.90 for a kg of CNG.

IGL Managing Director M. Ravindran said the company was compelled to increase the price because of the recent depreciation in the value of the rupee against the dollar.

“We have been forced to increase the retail price of CNG due to major increase in the input cost of entire pool of natural gas being sourced by us as a result of recent appreciation of dollar vis-à-vis rupee and the increased dependence on imported Spot R-LNG.”

IGL estimates that the increase for auto rickshaws would be 5 paise per km and for taxis 8 paise per km. In case of buses, the increase would be 50 paise per km, which translates to less than one paisa per passenger per km.

But observers say the hike in CNG price will make commuting costlier in the national capital region.

As per the government directive, all light commercial vehicles and most buses run on CNG in the Delhi region.

Prices of CNG have been hiked for the fifth time this year. The last hike was Oct 1, when it was increased by Rs.2 per kg in Delhi.

The Indian rupee has depreciated by almost 20 percent against the US dollar in the last five months. As a result of this, IGL has to pay more to import gas.

Ravindran said the base price of natural gas procured by IGL from all its sources - administered price mechanism (APM), KG-D6, long term R-LNG as well as Spot R-LNG was in US dollar. “Dollar has appreciated by 14 percent vis-à-vis rupee since the last price revision of CNG,” he said.

He said with the allotted APM gas having already been fully utilised and complete stoppage of KG-D6 supplies due to decrease in production, “IGL is left with no other alternative but to source costly Spot R-LNG to meet the ever increasing demand which has contributed to higher cost of sourcing the gas.”

IGL is a joint venture of GAIL, Bharat Petroleum and the Delhi government. It runs 232 CNG stations in the NCR and plans to open 30 new outlets by the end of the current financial year.