NMC’s bio-CNG project gets funding nod from centre
The central and state governments have released funds of Rs 48.10 crore for the Nagpur Municipal Corporation’s (NMC) three projects — bio-CNG, compost and material recovery facility (MRF) — proposed for garbage treatment and reuse. Funds have been approved under the Swachh Bharat Mission. The state urban development department on Tuesday issued a notification about releasing the funds. “Nagpur’s Solid Waste Management Plan was approved under the Swachh Bharat Mission. The Centre had released funds of Rs28.86 crore as its share to the state. The state’s share is Rs19.24 crore. Thus, a total amount of Rs48.10 crore has been released,” the notification stated. The NMC had sought Rs 267 crore under the Swachh Bharat Mission in 2016-17. The government had approved Rs 96.22 crore of which Rs 70 crore for waste-to-energy project and remaining funds of Rs 26.22 crore for procurement of road sweeping machine and other machineries for improving garbage collection and transportation. The government had released Rs 48.11 crore two years ago. The NMC had planned to drop waste-to-energy project due to failure of private operators to execute the project. The civic body has proposed to treat and reuse entire garbage by developing bio-CNG, compost and MRF centre at Bhandewadi dumping yard. Accordingly, the NMC requested the government to approve these three projects and also increase financial grant from Rs 96.22 crore to Rs 155 crore. The state’s high-powered committee had approved the NMC’s proposal in September 2018. Now, the grant of Rs 48.10 crore has been released. A few days ago, the NMC’s general body approved development of three new projects. Now, the NMC can begin tendering process and execute the projects. The NMC’s plan is to dispose of total garbage generated from the city in a scientific manner.
Why has Qatar refused to renegotiate prices of LNG contracts with India?
Qatar is not willing to renegotiate prices under its long-term liquefied natural gas (LNG) contracts with India. Why is this so? Will PM Modi use alternative channels to renegotiate the prices? In a latest development, Qatar is not willing to renegotiate prices under its long-term liquefied natural gas (LNG) contracts with India, the Middle Eastern nation’s energy minister said on Monday. Sources in Islamabad told GVS that India used all channels to convince the state of Qatar but remained unable to do so. Qatar is, however, willing to supply more volumes of LNG to India, said Saad Sherida al-Kaabi, who is in India to meet his counterpart, at an event in New Delhi. Kaabi, who is also the chief executive of Qatar Petroleum, was accompanied by the chief executive of Qatar Gas, Sheikh Khalid bin Khalifa Al Thani. “We don’t renegotiate existing contracts. Contracts are contracts for the duration we sign them for. We as businesses understand that the sanctity of contract is important for both sides. And for the credibility of both sides, both parties must respect that,” he said. “We are looking forward to adding more volumes in India and negotiating additional volumes.” Delivered spot prices to Indian ports are about half of those under the long-term LNG deals, reducing the appeal of the Qatar supply contracts for price sensitive Indian consumers. Prime Minister Narendra Modi has said India needs to increase the share of natural gas in its energy mix to 15% by 2030 from 6.5% now. India has in the past used its status as Asia’s third-largest LNG buyer to renegotiate deals with Qatar, Australia, and Russia. In 2015, it renegotiated the price of the long-term deal to import 7.5 million tonnes per year of LNG from Qatar, helping it save Rs 80 billion. At that time, Qatar agreed to price LNG at a three-month average Brent oil price instead of the previous practice of pricing it at a 60-month average of Japanese Crude Cocktail (JCC) in exchange for India buying an additional 1 million tonnes per annum of LNG. Both the contracts end in 2028.
Oil Min pitches for inclusion of natural gas in GST
Ahead of the Union Budget, the Oil Ministry has made a renewed pitch for inclusion of natural gas in the ambit of GST to promote the use of the environment-friendly fuel by reducing multiplicity of taxes and improving business climate. When the Goods and Services Tax (GST) was introduced on July 1, 2017, amalgamating 17 central and state levies, five commodities namely crude oil, natural gas, petrol, diesel, and aviation turbine fuel (ATF) were kept out of its purview given the revenue dependence of state governments on this sector. “Currently natural gas is taxed under the VAT regime with VAT ranging from 3 per cent to 20 per cent across states,” the ministry said in a booklet it brought out to promote the use of the fuel in automobiles, household kitchens, and industries. If brought under GST, natural gas will attract a uniform rate of tax at the consumption point anywhere in the country after doing away with current rates of excise duty and VAT. This, it said, would “result in an increase in state domestic product and socio-economic development owing to increased economic activities” which will lead to improved employment opportunities. Also, it would lead to improved investor confidence and attract more investment in natural gas infrastructure in the country, the booklet said, adding that a positive impact on environment and health due to reduction in carbon emissions across major cities was another advantage. “As gas is not under the ambit of GST, there is no input tax credit available. Further, the downstream industries are not able to claim the benefit of the tax credit of VAT paid on purchases of natural gas which is available for alternate fuels/feedstocks,” the booklet said. Oil Minister Dharmendra Pradhan too has been making a vehement pitch for the inclusion of gas in the GST. “We believe natural gas as also aviation turbine fuel (ATF) can be included in the GST regime,” he had said on Monday. Including ATF and natural gas will not just help companies set off tax that they paid on input but will also bring about uniformity in taxation on the fuels in the country, he had said. “Including natural gas in GST is said to be one of the biggest drivers of not just consumption but will also incentivize producers to spend more on finding and producing more gas as well as incentivize importers to bring in more LNG.” Finance Minister Nirmala Sitharaman is scheduled to present the Union Budget for 2020-21 fiscal on February 1. ATF makes up for almost a third of the cost of an airline and rates vary from state to state depending on local VAT. A uniform GST would also push the usage of environment-friendly natural gas, whose share in the energy basket the government wants to increase to 15 per cent by 2030 from current 6.2 per cent. Pradhan said the GST Council, the highest decision-making body of the new indirect tax regime, should take a decision in favour of these two fuels at the earliest. The Council is headed by Union Finance Minister and comprises representatives of all states and union territories. Under the existing structure, both natural gas and ATF attract the Centre’s excise duty and a state’s value-added tax (VAT). Both these and all other levies will get subsumed under GST if they are brought under its ambit. The decision on their inclusion depends on the financial position of states as revenues from these five petroleum products constitute a substantial chunk of state government finances. Barring a few, most of the states are incurring revenue shortfall as GST subsumed a dozen of their taxes, introducing the single levy, in a bid to simplify taxation system and remove the cascading effect of ‘tax on tax’ in the country. According to the industry, keeping ATF and natural gas out of the GST net is increasing the cost of these products as tax on inputs is not being credited against the sale of these products, which ultimately, adds to the cost of production. The Aviation Ministry has time and again sought inclusion of ATF under GST as any surge in international oil rates gets reflected in domestic jet fuel prices, leading to costlier air tickets. Natural gas is widely used as industrial input by a variety of industries – from power to steel – and it coming under GST would help eliminate the cascading impact of taxes, bringing down prices of CNG and piped natural gas.