India is committed to bring natural gas into Goods and Services Tax (GST) regime to make prices cheaper and uniform across the country, Prime Minister Narendra Modi said on Wednesday.
“We are committed to bringing natural gas under GST regime; I want to tell the world come invest in India’s energy sector,” the prime minister added.
He said India was spending ₹7.5 lakh crore ($103.05 billion) over 5 years to build its oil and gas infrastructure, PM Modi said.
India looking to cut energy import dependence, diversify imports, said Modi.
He said that India will generate 40% of all its energy from renewable sources by 2030.
In 2019-2020, India imported over 85% of oil and 53% of gas to meet domestic demand. “I don’t want to criticize anyone but I want to say, had we focused on these projects much earlier our middle class would not be burdened,” PM Modi added.
The prime minister earlier laid foundation stone of various key projects of oil and gas sector in Tamil Nadu via video conferencing.
PM Modi dedicated Ramanathapuram-Thoothukudi Natural Gas pipeline to the nation. He also dedicated Gasoline Desulphurisation Unit at Chennai Petroleum Corporation Limited, Manali. He laid the foundation stone of the Cauvery Basin Refinery at Nagapattinam.
“Indian Oil’s 143-km-long natural gas pipeline from Ramnathpuram to Thoothukudi that is being launched today will monetize the gas from ONGC’s gas fields. This is part of a larger natural gas pipeline project being developed at a cost of ₹4,500 crore. It will benefit several areas in South India,” he added.
PM Modi said that in the past six years, oil and gas projects worth over ₹50,000 crore have been approved for implementation in Tamil Nadu.
Dharmendra Pradhan, Union Minister for Petroleum and Natural Gas, and Edappadi K. Palaniswami, Chief Minister of Tamil Nadu, joined the event through video conferencing.
Earlier, industry experts had voiced their hope that the government should bring natural gas under GST regime to realise PM Modi’s vision for a gas-based economy and raising the share of the environment-friendly fuel in India’s energy basket, the industry has said.
Natural gas is currently outside the ambit of GST, and existing legacy taxes central excise duty, state VAT, central sales tax continue to be applicable on the fuel.
“Non-inclusion of natural gas under GST regime is having adverse impact on its prices due to stranding of taxes in the hands of gas producers/suppliers and is also impacting natural gas-based industries due to stranding of legacy taxes paid on it,” the Federation of Indian Petroleum Industry (FIPI) said.
FIPI also sought rationalization of GST on the service of regasification of LNG.