India has potential to be a major gas importer

With brand new liquefied natural gas infrastructure and new pipelines opening, India has the potential to be a major gas importer. But the government faces a dilemma which may scupper its gas ambitions. Does it deliver much-needed market reform or does it protect millions of citizens living below the poverty line?

An impressive line-up of politicians took to the stage in New Delhi last month to tell the world that India is thirsty for natural gas imports. For the first time ever, Prime Minister Manmohan Singh inaugurated the Asia Gas Partnership Summit (AGPS), as well as pressing the button to allow first flows through a new gas pipeline linking the Dahej liquefied natural gas (LNG) terminal on the west coast to factories 2,200 kilometres away in the northern states of Punjab and Himachal Pradesh. But while calling on the country to use more gas to fuel India’s economic growth, Singh also said pricing reform was needed to encourage imports, increased domestic production and to bring Indian gas prices