India launches biggest city gas distribution auction
New Delhi, May 8:In a major step towards ushering in a clean gas-based economy, India on Tuesday launched its biggest auction of city gas distribution (CGD) networks, offering permits for selling compressed and piped natural gas (CNG and PNG) in 86 geographical areas.
Awards from the 9th CGD licensing round would help bring gas coverage to 174 districts in 22 states and Union Territories, covering 29 per cent of the country's area and 24 percent of the population, said Union Petroleum Minister Dharmendra Pradhan launching the bidding round here.
According to the Petroleum and Natural Gas Regulatory Board (PNGRB), which organised a roadshow here to promote the auction, the ninth bid round is expected to attract investment of Rs 70,000 crore.
"This is the biggest step so far in CGD expansion, towards raising the gas share in the country's energy mix from 6.2 per cent to 15 per cent in a few years," Pradhan said.
So far, existing 91 geographical areas have been awarded to companies like Indraprastha Gas, GAIL Gas and Gujarat Gas, which cover 11 per cent of area and 19 per cent of the population.
The existing CGD networks are concentrated in the northern and western regions of the country.
"With this, the regulator is also acting as a facilitator for the CGD network," Pradhan said referring to the role of the PNGRB.
Changes have been made to the bidding conditions to facilitate greater return from the exercise. For instance, CGD networks have been granted status of utilities by the Union Labour Ministry.
Under the changed parameters, maximum weightage of 50 per cent has been given to the number of piped gas connections proposed in eight years from the date of authorisation, as against 30 per cent earlier.
The number of CNG dispensing stations proposed to be set up has been given 20 per cent weightage. Length of the pipeline to be laid in a geographical area, and the tariffs proposed for city gas and CNG have been granted 10 per cent weightage each.
Besides, there is a floor tariff of Rs 30 for city gas and Rs 2 per kg for CNG to prevent bidders from quoting unviable low tariffs.
Companies with net worth of not less than Rs 150 crore can bid for cities with a population of 50 lakh and more, while it is Rs 100 crore for cities with 20 lakh to 50 lakh population. Firms with Rs 5 crore net worth are eligible to bid for cities that have less than 10 lakh population.
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ED searches 'preferred' vendors of Amazon, Flipkart in FEMA probe
New Delhi, Nov 7: The Enforcement Directorate Thursday conducted searches against some of the "main vendors" operating on platforms of e-commerce giants Amazon and Flipkart as part of a foreign direct investment "violation" investigation, official sources said.
A total of 19 premises of these "preferred" vendors located in Delhi, Gurugram and Panchkula (Haryana), Hyderabad (Telangana) and Bengaluru (Karnataka) were covered as part of the action, the sources said.
It is learnt that the ED inspected documents and took copies of some from the premises of about six such vendors who were not named.
The sources said a probe has been initiated by the federal agency under the provisions of the Foreign Exchange Management Act (FEMA) after it received several complaints against the two large e-commerce companies where it is alleged that they were "violating India's FDI (foreign direct investment) rules by directly or indirectly influencing the sale price of goods or services and not providing level playing field for all the vendors".
There was no immediate response from the two e-commerce companies.
The Confederation of All India Traders (CAIT) welcomed the ED action.
"The CAIT, along with several other trade bodies, has been raising these issues for the past few years. I welcome the Enforcement Directorate's actions as a step in the right direction," CAIT secretary general and BJP MP from Delhi Praveen Khandelwal said in a statement.
He claimed that the Competition Commission of India (CCI) had also issued "penalty notices" to Amazon and Flipkart, and their "preferred" sellers, for "engaging" in anti-competitive practices that have adversely affected small traders and 'kirana' (grocery) stores.
As per existing rules, 100 per cent FDI is allowed through automatic route in the marketplace model of e-commerce. But overseas investment is not permitted in an inventory-based model.
In the market place model, e-commerce entities can only provide a platform for third-party sellers and they cannot own the inventory. They also cannot directly or indirectly influence the price of the goods.
It has been reported in the past that the CCI, which works to ensure fair business practices across sectors in the marketplace, is already looking into alleged anti-competitive ways of e-commerce companies.
The CAIT and mainline mobile retailers' association AIMRA had also petitioned the CCI sometime back seeking immediate suspension of operations of Flipkart and Amazon as they alleged that the companies engaged in predatory pricing and were burning cash to offer heavy discounts on products .
These practices, in turn, are creating a grey market of mobile phones, causing losses to the exchequer "as players in the grey market evade taxes", they had said.
Commerce and Industry Minister Piyush Goyal had recently flagged the same concerns as he had questioned Amazon's announcement of USD 1 billion investment in India, saying the US retailer was not doing any great service to the Indian economy but filling up for the losses it had suffered in the country.
He had said in August that their huge losses in India "smells of predatory pricing", which is not good for the country as it impacts crores of small retailers.
Goyal said e-commerce companies were eating into the small retailers' high-value, high-margin products that are the only items through which the mom-and-pop stores survive.
The minister had said that with the fast-growing online retailing in the country, "are we going to cause huge social disruption with this massive growth of e-commerce".
Khandelwal said that the CAIT has urged the CCI and the ED to protect the businesses of small traders.
"In the new Bharat, led by Prime Minister Narendra Modi Ji, no one is above the law. I am hopeful that now the law will take its rightful course and protect the livelihoods of small shopkeepers.
"This government is committed to ensuring that no entity can harm the trading community. In response to multiple complaints filed by the trading community regarding FDI violations and the anti-competitive practices of quick-commerce companies such as Blinkit, Swiggy, and Zepto, we urge both the CCI and the ED to take swift action and prevent any further, irreparable damage to the businesses of small traders," he said in the statement.
