Industrial units in South Gujarat stare at 58 pct cut in natural gas supplies

Written by Avinash Nair | Ahmedabad | Updated: Sep 12 2014, 00:23am hrs
Despite a change in leadership in New Delhi, the gas woes of industrial units in Gujarat seem to be far from over. Now at least 30 industrial units, employing over 1.2 lakh people in South Gujarat, are staring at an imminent closure after Gas Authority of India Ltd (GAIL) has proposed 58 percent cut in supplies of APM (Administered Pricing Mechanism) natural gas from September 16, 2014, official sources from the industry said on Thursday.

Among the industrial units --- most of which are into manufacturing glass and ceramics --- that are likely to be affected by the cut in gas quota include Gujarat Borosil Ltd which is the only producer of solar gas (used for solar panels, solar thermal heaters and green houses) in India.

"We have received a mail from GAIL announcing a 58 percent cut in supplies in order to comply with the guidelines of Petroleum and Natural Gas Regulatory Board (PNGRB). This cut will force the closure of over 30 units that are our members and have a combined annual turnover of Rs 5000 crore," said Ashok Jain, vice-president of South Gujarat Small Gas Consumers Association (SGSGCA) and the whole-time director of Gujarat Borosil Ltd while talking to The Indian Express.

Currently, these units together receive 6 lakh standard cubic meter per day (SCMD) of APM gas. "We get this gas at Rs 10 per SCMD. Most of us cannot opt for spot RLNG (Re-gasified Liquefied Natural Gas) which will cost about Rs 40 per SCMD or furnace oil," Jain added.

Apart from Gujarat Borosil, the companies that are likely to be affected include, Pragati Glass, Piramal Glass, Haldyn Glass, Schott Glass, Belgium Ceramics and others. "GAIL is seeking to implement a major cut in gas supply to these (industrial) consumers which shows no concern for the 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 Narendra Modi...," states an official release from SGSGCA circulated to the media here.

"Borosil is the only producer of solar glass in India and any restriction which will curtail Borosil's production will negatively affect the National Solar Mission," the release added. Gujarat Borosil produces 150-160 tonnes per day of solar glass at Govali village of Bharuch district.

SGSGCA has appealed for a status quo in this matter.