The Confederation of Indian Industry has proposed a single regulatory authority for the power and oil and gas sectors keeping in mind the increasing electricity generation from gas and liquid fuels.
In a paper on the hydrocarbon sector in India, the chamber has said though the oil industry has been deregulated, some areas still required regulation to ensure the effective functioning of the market mechanism.
The CII has said that separate regulatory guidelines are required to develop the petroleum and natural gas sector. It has also said that price regulation is not required since prices will be self-regulated through competition and market dynamics, except in special cases like that of national security.
According to the chamber, a single regulatory authority will ensure fair competition among players, monitor the availability and price of petroleum and gas products in different regions and help manage strategic oil reserves, establish quality specifications and monitor compliance, ensure equitable access to pipelines and monitor tariffs, set environmental standards and targets for technological achievements and so on.
The CII has recommended that the government needs to involve every constituent of the downstream sector, especially private players, to encourage investment.
The regulatory board should be funded through independent sources in order to ensure its autonomy, it has added.
The chamber has also suggested that the government should take steps to minimise price distortions, including removal or reduction of subsidies, and maintaining a flat duty structure on products.
The industry body has also proposed a co-ordination agency to review energy supply options in Asia, demand projections, frame stockpiling policies, bilateral stocks, regional energy trade among other things.