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Indian government to fund 40% cost of the $1.9 billion gas pipeline project

India´s Cabinet Committee on Economic Affairs approved viability gap funding for the gas pipeline project of the state-run Gail India Ltd. in the country's eastern part.

Indian government to fund 40% cost of the $1.9 billion gas pipeline project


India´s Cabinet Committee on Economic Affairs on September 21, 2016, approved viability gap funding for the gas pipeline project of the state-run Gail India Ltd. in the country's eastern part.

The 2,500-km pipeline is to be built by state-run GAIL (India), and this will be the first time the government has offered finance for such a project as part of Prime Minister Narendra Modi's plan for more balanced development.

It will be also the biggest pipeline project in the country and had won government approval in 2007 but could not move forward.

Gail India will develop the distribution networks with the state governments to supply clean cooking fuel to households and clean fuel to the transport sector in the eastern region.

The networks will benefit 10.3 million people living in the 7 eastern cities and generate jobs to about 21,000 people, besides boosting the socio-economic development of the region.

The ministry estimates that the pipeline, which is being constructed by GAIL under three phases, should be completed in about two-and-a-half years.

As per the Petroleum Planning Analysis Cell, part of the ministry of petroleum and natural gas, India’s gas pipeline grid length is 16,250km.

The country’s domestic gas production fell by 4.7% to 31.14 billion cu. metres (bcm) in financial year 2015-16 from 32.69 bcm in the previous year.


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