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By:

Quaid Najmi

4 January 2025 at 3:26:24 pm

Gas crunch reaches Mumbai’s high-rise

Mahanagar Gas cuts PNG supply by 50 pc; biz hit Mumbai : Delivering another shock, the Mahanagar Gas Ltd. on Saturday mandated all commercial users to draw only 50 pc of their piped natural gas (PNG) supply with a warning of steep fines and abrupt cut in connection for violators, sending shockwaves in the industry.   This comes barely 48 hours after its first missive (March 12) imposing a 20 per cent  cut in PNG offtake by commercial users, which hit the bakery industry hard, amid...

Gas crunch reaches Mumbai’s high-rise

Mahanagar Gas cuts PNG supply by 50 pc; biz hit Mumbai : Delivering another shock, the Mahanagar Gas Ltd. on Saturday mandated all commercial users to draw only 50 pc of their piped natural gas (PNG) supply with a warning of steep fines and abrupt cut in connection for violators, sending shockwaves in the industry.   This comes barely 48 hours after its first missive (March 12) imposing a 20 per cent  cut in PNG offtake by commercial users, which hit the bakery industry hard, amid  speculation that lakhs of domestic PNG users may be affected next.   The MGL’s directives follow a central order (March 9), calling upon all commercial users to restrict their PNG consumption to only 50 pc of their average usage over the past six months.   The revised rules within 48 hours sent fresh shockwaves among the already panicked commercial PNG users, triggering apprehensions that even domestic consumers may feel the heat with likely ‘rationing’ of their convenient piped fuel connections.   “The gas curtailment is around 50 pc for industrial customers and 20 pc for commercial customers to maintain continuous gas supply to our CNG stations and domestic PNG customers,” a company spokesperson told  The Perfect Voice , justifying its ‘force majeure’ intimations.   Price Revision In its first order, the MGL had indicated a revision in PNG prices due to “gas pooling” arrangements, with the final rates to be announced after consultations with suppliers and the government.   Today, it willy-nilly unveiled the potential harsh hike in the rates of PNG: “We have been informed that any gas drawal by MGL exceeding permissible levels will attract a gas price of Rs 138/Standard Cubic Metre plus VAT.”   Accordingly, all commercial users have been warned that from Friday (March 13), if they cross the threshold limits (50 pc), they will be charged Rs 138/SCM  (Rs. 4091.21/MMBTU), and further usage above the permissible limits would lead to abrupt disconnection of supplies.   Piped Gas Presently, the MGL has over 30-lakh households using PNG in Mumbai and Mumbai Metropolitan Region (MMR), besides 5,200-plus commercial-industrial clients spread in multiple sectors, wholly dependent on piped gas connections.   Additionally, it runs 471-plus CNG stations and supplies it to more than 12-lakh vehicles including public and private transport, with plans to cover large urbanized pockets of Raigad district by 2029   Some of its bulk users include: Godrej Industries Ltd., Larsen & Toubro, Hindalco, several five-star hotels, IT companies, medicare like Asian Heart Institute or Lilavati Hospital, pharmaceutical industry, food and beverages, etc.   Home-makers howl An online achievement school ‘Multiversity of Success’ Founder Dr. Rekhaa Kale (Sion) said if the PNG cuts reach homes, it will disrupt the lives of millions of Mumbaikars. “Now, I regret giving up my LPG cylinders 10 years ago for the PM-Urja scheme, it could have been a life-saver today,” grumbled Dr. Kale.   A private nurse Kirron V. (Dahisar) rued that the real impact of gas shortage will be visible in Mumbai if domestic PNG supplies are also hit. “The so-called elite living in airconditioned high-rises sniggered and ‘looked down’ upon those sweating it out in snaky queues for a LPG cylinder,” she said sarcastically.   As the Gulf War entered the 15 th  day today, the FHRAWI-AHAR Vice-President Pradeep Shetty and other major organisations have repeatedly slammed the government for the acute short supply of LPG leading to chaos all over.

Indian Shipbuilding A Must Win Marathon

Shipbuilding

With a coastline of 7500 KM, it is hard to imagine, that for the first 20 years (1947-1967) India had no ‘shipping ministry’. In 1967 a Shipping ministry “coupled” with ROAD transport was established. Since then, this ministry has been on a name changing ride, not once, not twice but six times. In 2009 the “ROAD Transport and Highways” was de-coupled and ‘Shipping’ ministry was formed. Turning point came in 2015 with a clear maritime vision for 2030 and 2047. Ministry was re-christened, aptly to Ministry of “Ports, Shipping and Waterways” in 2020.


Why is Shipbuilding important for a country?

a. A Shipyard becomes an opportunity hub and like a queen bee requires the support of an industrial colony to manufacture machinery and equipment.

b. National Shipyards support fleet renewal needs of the Navy.

c. Contributes to national GDP, increases inflow of FOREX.


Korea shipbuilding is 8% of GDP. Japan’s automobile industry is 2.9% of GDP. India’s shipbuilding a meagre 0.000578% of GDP. In context, India’s pharmaceutical industry, ranked third largest in the world is 1.72% of India’s GDP.


International Shipbuilding Market

The market is estimated to reach around USD 200 billion by 2029, growing at a CAGR of 4.84%. While India is at bottom with 0.07% of world share, behind Philippines 1.5% and Vietnam 1%, however on the positive side, India has done well in taking care of its defence needs, with 37 of 39 Naval ships being built in India yards. Rear Admiral S Shrikhande researching on maritime as a Fellow at Wollongong University, Australia, says “Shipbuilding in India needs both, serious incentivisation and dogged determination and not harping on being a big ship breaking country. That Garden Reach shipyard has a $54 million order for merchant ships from a German owner, is a good sign.”


Were Shipyards of 20th century in Flight mode?

Prominent shipyards in India were built in the colonial period. Mazagon Dock 1774, Garden reach 1884, Hindustan shipyard 1941 to cater to British navy and merchant fleet needs. Cochin shipyard 1972, Adani Katupalli 2013, Reliance Naval and Engineering, Rajula Gujarat 1997 and others have limited capacity, hence a lot more work to do. Capt. Subhangshu Dutt (Singapore) a mariner and now a shipowner, says “GOI should hold hands in any collaboration till the marriage with the foreign entity is reasonably stable. He also suggests that “new shipbuilding sites should be given to existing successful shipyards since they have decades of experience and talent. Consortium of 3 or more parties may also be good idea”.


Shipbuilding GOLD

As per SPLASH report the demand for LCO2 carriers could reach 2,500 ships by 2050. As per other estimates, 40% of global fleet of ships could have wind propulsion by 2050. A surge in such vessels is due to an unparallel waves of decarbonization in the shipping industry. Demand for ships with ‘carbon neutral’ badges, such as Dual fuel, Wind assisted, Nuclear fuel ships, Hydrogen powered ships, Liquified CO2 (LCO2) carrier, is outstripping supply. A must in the ‘bucket list’ of every Shipyard. Pinning down a standard ROI in shipbuilding is not easy, but experts suggest it could range from 4% to 15% for the high demand ‘carbon neutral’ ships. While an LNG new build vessel could cost US$ 250 million upwards.


International collaboration

On China’s shipbuilding success story, Manoj Pandalanghat (Singapore) a mariner and ship owner believes that “China has around 50 active Shipyards. Each have a few large dry docks. In each dock two or more large vessels are built simultaneously. Thus, a single yard is able to roll out 2/3 vessels/month, 36 vessels/year and 50 shipyards roll out 1800 vessels/year”.


China could be a jaldi-5, but India needs a sturdy Mount Fiji. Besides technology, Japanese bring the most important hand baggage of soft-skills and culture, essential for success from keel laying to delivery. Maruti’s is a standing example.


Food for thought for New Delhi

a. Expertise: Hire Naval Architects and shipbuilding experts with current international experience.

b. Government assistance: Land, Financial support, subsidies and timebound clearances.

c. Monitoring: PMO should monitor the first 5 to 10 years till Shipbuilding takes-off on this long-haul flight to destination 2047.


India’s Shipbuilding is expected to grow to $237 billion by year 2047. On a back of the envelope calculations this works out to about 4% of India’s 2047 projected GDP of $ 5 trillion. While cars are driven on roads, however the Ministry of roads and transport has little to do with “Automobile manufacturing”. On a similar note, ‘Shipbuilding’ as an industry has little to do with Ports, Shipping and Waterways, thus it may be worthwhile to consider a separate ‘Ship-building’ wing in the Ministry of Ports, Shipping and Waterways headed by a dynamic cabinet rank minister. Since 2047 targets are stiff and an uphill task, so in all probabilities, the officials in Ministry of Ports, Shipping and Waterways are likely to push beneath the carpet, delays and failures of Shipbuilding with sweet success stories of “Ports, Shipping and Waterways” and if this does happen then India will not only miss the Shipbuilding bus of 21st century but a lot more from a national security and strategic perspective.


(The author is a Shipping and Marine consultant. Member Singapore Shipping Association and empaneled with IMO as a specialist consultant. Views personal.)

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