Indian government to fund pipeline project

The Indian government will fund 40% of the cost of the US$2 billion Jagdishpur-Haldia and Bokaro-Dhamra (JHBDPL) gas pipeline project that is designed to link five eastern states (Uttar Pradesh, Bihar, Jharkhand, West Bengal and Odisha) according to the country’s Energy Minister.

It will be the biggest pipeline project in the country and the government hopes that this funding will be the first of many steps to make its economy more gas-based, particularly by the proect being located in a region that has trailed the rest of the country. 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.

A 2500 km pipeline will be built by the state-run company, GAIL (India) Ltd. Dharmendra Pradhan, India’s Oil Minister said that the government will fund 40% of the cost of the pipeline. The states that the pipeline will run though hold nearly 40% of India's 1.3 billion population, hence this pipeline will be extremely useful. Once the pipeline has been completed, India's gas demand is to rise by as much as 10 million m³/d.

"This will be the first time that government spending will be made for pipeline infrastructure. This will help in achieving the Prime Minister's vision of the economic development of the eastern states," Pradhan told reporters after a cabinet meeting.

According to Reuters: “India's economic development has been [widely] concentrated in the western and southern states, where there is better infrastructure and more accessible energy supplies.” However, the government hopes that the creation of the JHBDPL pipeline will attract investment in the east by linking the east to the national gas grid.

UPI highlights: “India's economy is expanding at a faster rate than its peers and demand for energy resources like coal, crude oil and natural gas are on the rise.”

Edited from various sources by Anna Nicklin

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