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CNG prices in NCR hiked by Rs 2.90 a kg
Posted on 09 Jul 20125,537 Views Comments
Hike in CNG prices may spark demand for fare hike
Indraprastha Gas Ltd (IGL) on Friday raised the price of CNG by Rs 2.90 per kg, or about 8%, to offset the impact of the rupee's fall against the dollar, upward revision in electricity tariff and rising volume of costlier imported gas in the sale. The latest increase, the second this year, marks a 14% increase in the fuel's price since January, and is expected to set off demands for a fare hike by public transport operators.
In Delhi, CNG would now cost Rs. 38.35 per kg. The quantum of increase would be Rs 3.30 a kg in Noida, Greater Noida and Ghaziabad due to a higher rate of state tax, and would cost Rs 43.10 a kg. IGL had last raised CNG prices in March. The company, however, claimed the latest hike would push up running cost of autos by only 8 paisa per km, 14 paisa per km for taxis and 83 paisa per km for buses, which translates to less than two paisa per passenger-km.
Company executives said even after Friday's hike, CNG would still be 60% cheaper than petrol and about 8% than diesel.
IGL said rupee's fall against the dollar was the main reason for price revision. It said the rupee had depreciated about 14% against the dollar since the last hike. The impact of the rupee's fall gets magnified as even domestic gas price is set in dollar. The company also has to sell increasing volumes of imported gas to overcome the shortfall in domestic gas. Gas imported in ships from international spot markets cost three to four times that of domestic supplies. IGL also cited the 23% hike in electricity tariff and upward revision in minimum wages as factors that necessitated a revision of CNG prices.
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