Planning Commission Deputy Chairman Montek Singh Ahluwalia on Wednesday said ‘price pooling’ mechanism for coal and gas should be adopted in the country.
However, pooling for gas won’t be feasible in the near future as it involves several sectors including fertilisers and agriculture in addition to power, cement, steel and petroleum.
“In the next 3-4 years, I do not see any way of resolving these issues unless high level decisions are taken, and both coal and gas (domestic and imported) prices are pooled,” Ahluwalia said while addressing 15th India Power Forum 2012.
He added that the efforts for price pooling for coal are under way and likely to be implemented by this year end.
The Planning Commission Deputy Chairman expects US to ease export of gas after Presidential elections.
Ahluwalia highlighted that industrial and infrastructure growth are related to the power sector.
“Delivery of infrastructure sector and more importantly power sector is important .... one of the questions is where should the Government’s capacity be concentrated ... industrial development can be aided by the power sector,” he said.
The Planning Commission feels that the real problem is unavailability of coal and not installation of generation capacity.
“The single biggest problem in the short term or 2-3 years is fuel supply,” Ahluwalia noted.
At the same time, non-performance of power sector has a ripple effect on banks and financial institutions.
“There is a downturn, the non-performing assets are on the rise, the capital adequacy of the banks is under stress and this is happening at a time when globally there is huge pressure on banks,” he added.