Needed : Policy for Natural
resources
Hindustan
Times ( 25 May 2016 ) carries a report with following headline :
"
Take charge of all private wells , HC tells state "
Report
goes on :
Stating
that water is a " natural resource that
belongs to entire nation " and not to any private entity ,
the Bombay High Court ( HC ) on Tuesday directed the government to requisition
or take charge of all private wells till the time the state faces water
shortage
This
order raises following questions :
#
What about other Natural Resources that too, belong
to entire Nation ?
# Can these continue to " belong to private parties
" when there is no
shortage ?
#
Who shall decide , what is a Natural Resource and
how can it be used for
the benefit of the entire Nation ?
#
Should it be left to the judiciary to decide upon
these issues , only when
someone files a PIL or should NDA government
bring out a definitive and
comprehensive LAW to regulate use of National
Resources ?
I
request NDA Ministers to read my following blog , and come up with a proper
law :
------------------------------------------------------------------------------------
Sunday, 16 February 2014
This is with reference to the
controversy surrounding the pricing of KG-6 gas of Reliance , which started
with $ 2.4 , is currently $ 4.2 and slated to rise to $ 8.4 / unit , from April
2014
Writing in yesterday's Times
of India , ( Swaminomics ) , eminent economist , Swaminathan Anklesaria Aiyar ,
made following points :
> Reliance (
KG - 6 ) accounts for only 10 % of the gas production in our
country
. Balance 90 % is by Public Sector Companies such as ONGC etc
> Hence , any
increase in selling price will mostly benefit government itself
(
Any idea , what will government do with this windfall ? )
> Price - hike
envisaged is recommended by a committee headed by Mr C
Rangrajan ( - implying , infallible / sacrosanct ? )
> By
introducing price control on gas , " India's name is mud globally , and
top
exploration companies now avoid India "
> An economic
rule of thumb is that " traded Commodities " should be
priced on par with the import price ( my question : irrespective of the
actual cost of production in India ? )
The
Rangrajan price of $ 8 / unit , is well below the import price
Not being an economist , I am
confused !
May be Mr Aiyar can dispel my
following doubts :
# By
taking out of our own soil ( or sea ) , does gas become a " traded
commodity " ? - even if entirely sold in India ?
# Is
KG-6 gas a " Natural Resource " which belongs to the Nation - and
not to Reliance ?
# Is
Reliance the " Owner " of the gas or a mere " Contractor
" ?
# Would Mr
Aiyar , want the Central Government to extend the same logic
to other " Natural Resources " ( belonging to the country ) , being
dug
out from the earth ( by private companies ) , such as :
* Oil / Coal / Shale Gas etc ( Fossil
Fuels )
* Ores of Iron / Copper / Zinc / Aluminum etc
* Trees ( timber ) that grow in our jungles
* Any number of minor minerals / chemicals
Should these too , be treated as " Traded Commodities " , whose local
selling prices must be same as Imported prices ?
# What
about the air / wind that blows freely over our land ?
Does it belong to the Nation or not ?
Or , does it belong to the Companies setting up WIND FARMS , to
generate electricity ?
Should such power be " Price Controlled " or not ?
# What
about the Sunlight that falls on our vast land ?
Who does it belong to ? To our government or to the companies setting
up mega Solar Power Projects ?
Should there be a price control on such power - produced , using a
National Resource ?
# What
about the hydro - power generated by private sector companies
from
the water flowing in our Country's rivers ?
Does
- or does not - that water belong to the Nation ?
Should not such power be price - controlled ?
# Tomorrow , if a
private sector company ( or a consortium of Indian
Companies , in joint venture with foreign companies ) , invest Rs 1 Lakh
Crores , to build the 22 Km long Kalpsar Dam across the Bay of Cambay
in Gujarat , and generate 10,000 MW of power from Oceanic
Tides , -
can
they be allowed to set any selling price ? At International price ?
I suppose
, it would be next to impossible for them to " Export " such
power beyond the shores of India !
# Incidentally ,
what about the Airwaves ( the 2G / 3G Spectrum ) ?
Is
that also a Natural Resource which belongs to the Nation ?
Having " licensed " it from the Central Government , can Mobile
Phone companies , set any selling prices for their services ?
Even with a combined debt of
around Rs 2 Lakh Crores , how are these
Mobile
companies , able to deliver ( nearly ? ) cheapest mobile phone
services
in the entire World ? May be at 10 % of international price ?
# In ALL of the
above - mentioned cases , should Central Government
carefully calculate / frequently audit , the " Cost of Production " ? Then
link the
" Local / Domestic , Selling Prices
" to such " Cost of Production "
allowing
certain pre-determined " Return on Investment " ?
# Even as we
agree that " Export prices " of gas are governed by prevailing
international prices , how come the " Domestic Prices " of gas are
vastly
different in different countries , ranging from under $ 1 to $ 5 / unit ?
Does this itself , not prove that , in each country ,
domestic prices are
linked to their own local " Cost of Production " ?
# Very often , have we
not exported , food grains , at " Below the Cost " ?
Mr AIYAR ,
You will be doing a great
service to millions of ignoramus like me , by offering your own " Views
" on the points raised above
And , I suppose , since the
fall in production from KG - 6 , is purely and entirely , due to "
Technically Sound " reasons , raising of the selling price to
$ 8 ( or even $ 16 / - ! ) ,
won't result in any increase in production !
Time alone will tell !
-------------------------------------------------------------------------------------
FOOTNOTE
:
It seems , Oil Minister , Shri Dharmendra Pradhan has taken some of my suggestions into account while announcing auction of 67 Oil / Gas blocks , yesterday
Hindustan Times ( 26 May 2016 ) describes these as follows :
" Spelling out salient features of the policy , sources said the auction will be done on a REVENUE SHARING model, where bidders will be asked to quote the REVENUE they will share with the government at LOW and HIGH end of the PRICE and PRODUCTION
The new REVENUE SHARING REGIME will replace the controversial PRODUCTION SHARING contract ( PSC ) model where oil and gas blocks are awarded to those firms which show they will do maximum work on a block
Also , a single license for exploration and exploitation of conventional and non-conventional hydrocarbons will be issued and operators will have freedom to sell oil and gas on arms length market price , Pradhan said , adding that there would be no cess on crude oil "
-------------------------------------------------------------------------------------
26 May 2016
www.hemenparekh.in / blogs
----------------------------------------------------------------------------------------
hemen parekh
Marol , Mumbai , India
( M ) +91 - 98,67,55,08,08
No comments:
Post a Comment