NEW DELHI, March 20 — A huge subsidy bill projected at over Rs 6,000 crore has put a question mark over implementation of the mega gas cracker project, even as a delegation of the Assam Assembly has arrived to plead with the Prime Minister to clear the last hurdle. But lobbying notwithstanding the Prime Minister’s Office (PMO) may have a hard time trying to convince the Union Finance Ministry to clear the subsidy given the Centre’s huge budgetary deficit.
However, State Industry Minister, Bhubaneswar Kalita, who is part of the Assembly delegation contends that additional subsidy may not be required at all if the oil companies operating in the North East manages to increase its output in the next five year. “The gas cracker project will go into production after about five years by which time the production in the region can be easily augmented,” he asserted.
This strategy was adopted by Assam Government after the Petroleum Ministry made as projection envisaging additional annual subsidy of Rs 400 crore for the Rs 3,700 crore project. The estimated requirement of additional subsidy for 15 years period has been projected at around Rs 6,000 crore, confirmed the Minister.
The subsidy is in addition to the Rs 377 crore already promised by the Centre for the project. The additional subsidy is for the supplying the LPG as the alternate feedstock to fill the shortfall in gas. The LPG is to be supplied by Indian Oil Corporation.
“The projection for additional subsidy has been calculated by Petroleum Ministry and we have not accepted it,” said the Minister. Sri Kalita argued that estimated Rs 900 crore collected from the State annually as oil cess could be ploughed back into Assam’s oil fields to increase production.
Meanwhile, the Assembly delegation headed by Speaker Prithibi Majhi and that included Hiten Goswami, Bimalangshu Roy and Hemandra Brahma is calling on the Prime Minister here tomorrow. The meeting is crucial given the high stakes involved. “Everything now rest with the Prime Minister,” said Sri Kalita.