CNG. Can Not Go?

As mentioned in the introduction, I talked some very basic shop and ended up calling this friend of mine an idiot. Of course, we shall get more of CNG and everything else along the way, I assured him. Till I researched it some and realized that our country's progress on this front, at least, is not really what it is made out to be. Amazingly, the infrastructure just doesn't exist. For we never created it. We launched CNG in India, but we stopped at the top metropolises and towns. We never bothered to take it through the head, heart and hearth of the country.

Where we did launch CNG, we somehow still see lines of vehicles painfully and pitifully waiting for hours to get the feed that shall see them careen around our large cities for a few 100 kms, at best. That's because over 82 per cent of the CNG filling stations in India are in the NCR region of New Delhi, Maharashtra, Uttar Pradesh and Gujarat. The rest of India continues to wait with bated breath to get a whiff and taste of cleaner and cheaper fuel.

A deal-breaker? Perhaps. And a real let-down, for sure. Why would a globally-proven clean technology not be launched seamlessly across the country? We have had enough time since the hockey stick boom in CNG usage in commercial and private vehicles began in 2008. Why are we talking new Parliament buildings and vistas when you and I are waiting in line to get basic fodder for our vehicles?

Pollution-beater waylaid

Pollution-beater we called CNG, even though vehicular pollution makes for only a miniscule percentile points of the devil in our skies. We conveniently ignored this insight and went bombastic along. We even went bolistic and passed some draconian laws outlawing and outlining the lives of our vehicles (15 years for petrol vehicles and 10 years for those gulping up diesel). While Indians grappled with these circuitous rules, 'pollution-beater' CNG was cast aside. But we galloped on, with advertisements singing paeans of our smart and ultra-sharp moves to combat Global Warming and Climate Change.

As always, we have raised a plinth while ignored the basics. We have launched cars without their basic necessity, food and sustenance; fuel. That's akin to raising dogs and cats without their nuggets. Were we even thinking, or merely grandstanding and aggrandizing with the hidden intent of muting our ignoramus masses with our on-ground inaction and in-corridors chutzpaz?

What were we thinking?

Apparently, we weren't really thinking, because decades down the line, we still don't have a nationwide supply chain for CNG vehicles in place. And yet, we have come up with the inane directive to scrap petrol and diesel vehicles, in a country where 63 per cent of our brethren buy a second-hand car to move up the value chain – from a scooter or motorcycle to a car, some comfort and a new status symbol.

Figures as of April 2020 reveal startling numbers. In all, across the country, we had 2,208 CNG filling stations traversing the few above-mentioned states, with a mild presence in another 10 states, making for grand total of 13 states. Thankfully, another 56 were inaugurated in May this year, through the lockdowns, vide the newly-empowered states and Union territories.

Commendable. But keep in mind, these 2,264 filling stations are meant to cater to a total of over 34 lakh existing CNG vehicles. That number is increasing daily. Every new personal CNG vehicle needs gas. Every Ola. Uber. Local transport buses. Gujarat leads the pack with 636 CNG stations, followed by New Delhi with 419, Maharashtra with 370, Uttar Pradesh with 306 and Haryana with 104. Some other states like Telangana, Andhra Pradesh, Madhya Pradesh, Punjab, Karnataka, Odisha, Rajasthan and Tripura complete the list (as of April 2020).

And while CNG gets largely ignored, the authorities are milking petrol and diesel through excise duty hikes. In fact, these duties and taxes have reached a point where keeping a car or motorcycle fueled up and running is becoming tantamount to investing in a luxury item.

Don't look at the math

"Don't look at the math," a senior minister said a while back, as he announced the higher taxation on petrol and diesel across the country. Let's leave his advice aside for a moment. Let's see what the Controller General of Accounts (CGA) had to say recently, while declaring figures for Government revenues and expenses. The CGA revealed that there has been a massive slowdown in tax collection numbers between 2019 and through this ongoing year. This includes Income-Tax, Customs Duties, Goods and Services Tax (GST), Compensation Tax and Excise Duties. Our total tax collections dropped by 23.7 per cent, jarringly similar to the fall in our Gross Domestic Product (GDP) figures, which was down 23.9 per cent. Net-net, the total fall in gross tax collections in the country over the last year has been over Rs 5 lakh crore.

Admittedly, there is a clear explanation and connect between the fall in tax collections and the ongoing economic scenario, both in India and across the world. As the COVID-19 scourge rages on unabated, every sector is facing fire and near sudden-death scenarios. Today's globalized economy has ensured that the whole world and India have been assaulted by falling revenues and tax collections. In a nutshell, revenues and collections are down, but due payouts remain the same. That's a vexed problem.

But wait, there's a savior

That savior is excise duties on petrol and diesel. Today, they are higher than ever before. And that's simply because pushed into a smelly financial corner, the authorities have used up their last trump card and pumped up duties on petrol and diesel to levels unheard of, making India the most expensive nation to buy these fuels. And ironically, this is at a time when international crude prices are at record lows. The resurgence in demand for fuel products through the pandemic has stoked collections, with excise collections (including taxes on petrol and diesel) jumping past Rs 100,000 crore.

How were these astronomical numbers achieved? Well, through an equally astronomical increase in taxes on petroleum products. As overall tax collections plummeted with the onset of the COVID-19 pandemic and sliding demand and earnings, the Government floored the pedal on taxes on petrol and diesel. So much so, that powered by this increase, overall excise collections between April and August this year actually jumped by over 32 per cent, even as every other tax avenue saw a downward slide.

In March and then again in May, excise on petrol and diesel were hiked. In March, excise on petrol and diesel were increased by Rs 3 a liter. Again in May, excise duties saw an increase of Rs 10 per liter on petrol and Rs 13 per liter on diesel. The reality and impact on the ground is shocking – while the landed price of petrol in October is Rs 25.68, the selling price at fuel pumps, including taxes, is Rs 81.06. A paradoxical offshoot of the above figures is that if the authorities had set up a robust CNG distribution outlet, excise collections could have been even higher!

Some beginnings…

All this having been said, a beginning has been made. Last week, the Government announced plans to pump in $60 billion (Rs 4,50,000 crore) into the upgradation of the CNG distribution network. Unveiling these plans, Minister of

Petroleum & Natural Gas and Steel Dharmendra Pradhan elaborated that the said investment would be made in gas infrastructure, which includes laying of pipelines, terminals and gas fields. This is an important move as the country moves towards a gas-based economy and attempts to reduce our dependence on imported crude oil.

But these on-ground beginnings are, at best, modest. Here's how. To expand the reach of the environment-friendly CNG, the authorities recently dedicated 42 CNG stations and three City Gate Stations of Torrent Gas. In the future, together with the existing CNG stations and the ones expected to come up, India is looking at an infrastructure of about 10,000 CNG stations over the next decade. These are very low numbers, and way too concentrated in certain states and territories

What is required is speed and concrete plans to quickly roll out thousands more CNG stations. Not until we stop seeing long and snaking queues of cars and auto-rickshaws outside CNG filling stations will a mass acceptance of gas-powered vehicles take place, for no one would like to wait for hours to tank up on gas for the privilege of driving for a measly 150-odd kms. And as CNG is available only in some key metros, the possibility of going for holidays in your CNG-run car is down and out for a long time. Till such time, you can only say – CNG equals 'Can Not Go'.

The author is a communications consultant and clinical analyst. [email protected]