X

Sign up for Equitymaster's free daily newsletter, The 5 Minute WrapUp and get access to our latest Multibagger guide (2017 Edition) on picking money-making stocks.

This is an entirely free service. No payments are to be made.


Download Now Subscribe to our free daily e-letter, The 5 Minute WrapUp and get this complimentary report.
We hate spam as much as you do. Check out our Privacy Policy and Terms Of Use.
Gas price deregulation: A distant dream - Views on News from Equitymaster
 
 
  • PRINT
  • E-MAIL
  • FEEDBACK
  • A  A  A
  • Aug 21, 2009

    Gas price deregulation: A distant dream

    After years of government control, India made the shift towards lesser regulation in the early 1990s. But old habits die hard. As per a leading business daily, the oil ministry plans to determine the price of natural gas till the time the acute shortage is addressed. The price will be determined on a cost-plus-adequate return basis. The official reason is that such a price will be in line with the Integrated Energy Policy, adopted by the government in December 2008.

    We wonder to what extent the decision is a result of the ongoing public spat between the Ambani bothers.

    On the broader question of liberalisation though, we believe this sends out a wrong signal. It is true that there is a huge demand-supply mismatch in the natural gas sector in India. But the answer to every problem is not government intervention. Till today, the government finds it hard to leave matters to market forces. Even when on paper it says it has done so.

    Take the example of the Administered Price Mechanism (APM) regime for the oil and gas sector. It has been dismantled for years now, but the government finds it very hard to let go of petroleum product prices. The point is, license permit raj perpetuates a 'mai-baap sarkaar', fosters red tape and corruption, and ends up choking the energy of the entire country.

    What we really need is well regulated free enterprise, if India is to move beyond its underachiever status of the last 62 years.

    India's auto story keeps getting better
    Slowdown or no, the Indian auto sector, be it domestic or exports, is vrooming ahead. As per a leading business daily, the response of powerful super bikes in India has been really encouraging. In fact, that global motorcycle majors such as Yamaha, Suzuki, KTM, Kawasaki and Honda plan to introduce new bikes in the coming months.

    In another development, Suzuki is transforming Maruti Suzuki as the largest research and development centre for Suzuki outside Japan. Maruti Suzuki now has a 700-acre facility for R&D located in Manesar (Haryana) and has recently hired 8 automobile engineers from Detroit, the auto hub in the US to augment its R&D capabilities. Tata Motors has also visited Detroit. It may be noted that the US auto industry, once the global leader, is now in shambles leaving talented technocrats up for grabs.

    In our opinion, the Indian auto space looks exciting partly based on strong domestic demand and partly on the confidence of Indian auto companies in designing and manufacturing cars for global markets.

     

     

    Equitymaster requests your view! Post a comment on "Gas price deregulation: A distant dream". Click here!

      
     

    More Views on News

    How to Ride Alongside India's Best Fund Managers (The 5 Minute Wrapup)

    Jun 10, 2017

    Forty Indian investing gurus, as worthy of imitation as the legendary Peter Lynch, can help you get rich in the stock market.

    You've Heard of Timeless Books... Ever Heard of Timeless Stocks? (The 5 Minute Wrapup)

    Aug 19, 2017

    Ever heard of Lindy Effect? Find out how you can use it to pick timeless stocks.

    Why NOW Is the WORST Time for Index Investing (The 5 Minute Wrapup)

    Aug 18, 2017

    Buying the index now will hardly help make money in stocks even in ten years.

    Trump Takes a Beating (Vivek Kaul's Diary)

    Aug 18, 2017

    Donald J Trump, a wrasslin' fan, took a 'Holy Sh*t!' blow on Tuesday.

    How To Read Your Mutual Fund Account Statement Correctly (Outside View)

    Aug 17, 2017

    PersonalFN simplifies the mutual fund account statement for you.

    More Views on News

    Most Popular

    Demonetisation Barely Made Any Difference to Tax Collections(Vivek Kaul's Diary)

    Aug 7, 2017

    The data tells us quite a different story from the one the government is trying to project.

    A 'Backdoor' to Multibaggers: It's Like Investing in Asian Paints Ten Years Ago(The 5 Minute Wrapup)

    Aug 10, 2017

    Don't miss these proxy bets on growing companies or in a few years you will be looking back with regret.

    Should You Invest In Bharat-22 ETF? Know Here...(Outside View)

    Aug 8, 2017

    Bharat-22 is one of the most diverse ETFs offered so far by the Government. Know here if you should invest...

    Signs of Life in the India VIX(Daily Profit Hunter)

    Aug 12, 2017

    The India VIX is up 36% in the last week. Fear has gone up but is still low by historical standards.

    7 Financial Gifts For Your Sister This Raksha Bandhan(Outside View)

    Aug 7, 2017

    Raksha Bandhan signifies the brother-sister bond. Here are 7 thoughtful financial gifts for sisters...

    More
    Copyright © Equitymaster Agora Research Private Limited. All rights reserved.
    Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement.

    LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.

    SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.

    Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
    Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: info@equitymaster.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407
     

    Become A Smarter Investor In
    Just 5 Minutes

    Multibagger Stocks Guide 2017
    Get our special report, Multibagger Stocks Guide (2017 Edition) Now!
    We will never sell or rent your email id.
    Please read our Terms

    S&P BSE SENSEX


    Aug 18, 2017 (Close)

    MARKET STATS