he wider implications of mismanaging India's energy sector are disastrous.

Inappropriate energy sector policies are at the core of the current fiscal imbalance, both on the external and the domestic account. Importantly, India's socio-economic parameters that remain at or below subSaharan levels cannot be improved without providing affordable and adequate access to modern commercial energy to every Indian. Unfortunately, India's energy policies are not geared to achieving this objective. Sir, some of your learned Cabinet colleagues have made price increases the mainstay of energy sector reforms. Handpicked "Expert Committees", support their arguments with dubious analysis. Allow me, Sir, to demolish the myths they together propound to mislead the nation on energy pricing. Myth 1: The Indian energy sector is heavily subsidised: India's energy sector has many cross-subsidies but no net subsidies. Oil and gas taxes alone contribute 15 per cent of the central government's revenue and 20 per cent of total state government revenues. The erroneous policy of promoting surplus refining capacity through incentives funded by the Indian taxpayer has, in addition, forced your fellow taxpayers to subsidise foreign buyers of surplus Indian petroleum products. India exports petroleum products at prices well below those paid by domestic consumers. Quite paradoxically, petroleum products have emerged as the lead export of an energy-deficient and energy-starved India. Contrary to common belief, even coal carries no subsidies. Instead, haulage of coal and petroleum products by rail, cross-subsidises passenger fares. Myth 2: India's energy prices are low compared to international levels: The effective cost of all primary and secondary commercial energy sources to Indian end-users is among the highest in the world, if compared correctly. Based on capacity to pay and purchasing power parity; even merit goods like kerosene and LPG, are over-priced despite massive crosssubsidisation. This is why over 70 per cent of your fellow citizens either lack access or have grossly inadequate access to modern commercial energy. Myth 3: India is highly dependent on imported energy: The government and its "experts" repeatedly cite high import dependence as justification for raising energy prices. India imports less than 28 per cent of her primary energy consumption. Import dependence remains below 37 per cent even if one only considers India's commercial energy consumption. This compares with an almost 100 per cent import dependence of Japan. And yet, Indians already pay more for energy than the Japanese based on a defensible comparison. In any event, the economic justification for raising the price of a domestic resource whenever its consumption is supplemented through higher priced imports and denominating the domestic price in the dollars is, in itself, debatable. The selective application of such a policy to pricing different products within the energy sector, as also across different sectors, compounds price distortions. Myth 4: India's power sector makes heavy losses because of low tariffs: The Indian power sector, taken as a whole, does not make losses. All energy sector enterprises, except the state distribution companies, are profitable. Ironically, it is the state distribution companies that generate the bulk of the cash flow that delivers the returns to the others. A fair reallocation of risks and rewards in the sector would actually see tariffs going down rather than up. Average Indian power tariffs are grossly non-competitive by global standards. The proposed increase in the price of domestic gas will make matters worse.

I humbly plead you. agricultural and services sectors and households. However. I invite an open debate with anyone of your "experts" on the inappropriateness of both the 2007 formula and the Rangarajan Committee formula for determining wellhead price of domestic gas. Nip the proposed domestic gas price hike in the bud before it gets labelled as yet another scam under your watch. India's energy intensity of GDP today is half of its 1990 level. the energy intensity of agriculture has doubled over the same period. to not burden the nation with Rangarajan Committee's madness that only benefits a select few. I am equally willing to debate any other issue raised above. The consequences of the proposed hike in domestic gas prices will be detrimental to India's food security. At stake are the Indian industrial. Since an entrenched oligarchy is the defining feature of our governance structure.The deafening silence of both major political parties on the proposed doubling of the wellhead price of natural gas compelled me to write this open letter. Respectfully yours .