Thursday, May 24, 2012 -
India’s oil minister on Thursday rushed back home early from signing a key gas agreement with Turkmenistan to justify why he authorized the country's steepest-ever hike in petroleum product prices.
Sudini Jaipal Reddy left the Turkmen capital Ashgabat a day early in an attempt to calm the anger sparked by the rise of petrol to $0.32 per gallon.
Reddy had signed a key sales and purchase agreement with the Ashgabat government on Wednesday to secure natural gas through the planned inter-regional pipeline TAPI for his petroleum-starved country.
The four partner countries of the Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline envisage the project as transporting 33 billion cubic meters of gas (bcm) per year from vast fields in the Central Asian republic to Pakistan and India.
But while Reddy was in Turkmenistan, the Oil Ministry jacked up the prices of petroleum products back home to record-high levels.
The ministry, which sets the prices of diesel, domestic liquid petroleum gas, and kerosene, has kept levels unchanged since June 2011. Petrol prices are set by the country’s state-controlled companies.
In related TAPI pipeline news, the U.S. – a longtime supporter of the plan – called the signing of the agreement a “very positive step forward.”
“We consider it a very positive step forward and sort of a key example of what we’re seeking with our ‘New Silk Road’ initiative,’ which aims at regional integration to lift all boats and create prosperity across the region,” U.S. Secretary of State spokeswoman Victoria Nuland told reporters at a briefing on Wednesday.