Following revised guidelines, GAIL has decided to cut domestic gas supplies to over 30 glass makers.
Following revised guidelines by the Petroleum and Natural Gas Regulatory Board (PNGRB), gas distributor GAIL has been authorized to divert domestic gas from non-priority sectors to meet the requirement of compressed natural gas (CNG) and piped natural gas (PNG) segments as per their actual consumption.
After considering revised PNGRB guidelines, GAIL has decided to cut domestic gas (administered price mechanism gas) supplies by 58 percent to over 30 glass makers beginning September 16. Total gas allocation to these companies is about 0.6 million metric standard cubic meters per day (MMSCMD), which will be reduced to 0.35 MMSCMD. The decision to cut supplies to manufacturing units in South Gujarat raises fears about leaving many glass and ceramics units non-functional and rendering thousands jobless. Companies that will be affected include Pragati Glass, Piramal Glass, Haldyn Glass, Gujarat Borosil Ltd, Schott Glass and Belgium Ceramics among others.
“The decision would force companies to depend on either imported RLNG or furnace oil, which are almost four times costlier than APM Gas. This will lead to losses for the companies,” said Ashok Jain, vice-president of the South Gujarat Small Gas Consumers’ Association (SGSGCA).
“We will fight against the decision and if it yields nothing, will stop production,” said Jain, who is the director of Gujarat Borosil Ltd, which manufactures low iron textured solar glass for photovoltaic panels in solar projects. With stoppage in production at these companies, about 100,000 people will lose their jobs, while economic loss will be huge. Yet the sector figures among the last in the priority list for APM gas distribution.
“GAIL is seeking to implement a major cut in gas supplies to these consumers, which shows absolutely no concern for industry. This runs counter to the target ‘Make in India – Made in India’ boldly announced by the newly installed Government at the Centre under the leadership of Honorable Shri Narendra Modi, who has taken the goal of making India a manufacturing hub in Asia,” an SGSGCA statement said.
SGSGCA termed the proposed action of GAIL and the directions of PNGRB ill-conceived, arbitrary, unjustified and ignoring the fact that these small gas consumers have set up their factories in isolated and small rural areas based on availability of gas.