Wednesday, May 17, 2006

Infructious, Infuckious

Do you know what an “infructious investment” is? It’s buying or creating a backup when somebody else believes that you don’t need one. For example, if you have a legal life partner and you go out and acquire another partner (perhaps because you’re dissatisfied with the first partner or fear that he/she may prove unsatisfactory in servicing your future needs), the expenses you incur may be considered an “infructious investment”.

The Indian government is a little confused on this subject. It’s okay for example, to create a new fibre-optic network in an area already serviced by one. Or to buy a new PC even if the old one is working fine. Or for an individual to possess two or more cars.

But it’s not okay to be legally bound to more than one life-partner unless you are a Muslim of the male gender – in that case, you’re allowed to have up to four before you're pulled up for making infructious investments (in this particular instance, it's called "polygamy").

According to the GoI, it’s also definitely not okay to lay a second gas pipeline in an area already serviced by one. It doesn’t matter if the extant pipeline is insufficient to service demand or if the transporter’s service standards suck.

The new PNGRBA – the Petroleum and Natural Gas Regulatory Board Act, which has finally passed into law after a four-year saga of drafting and redrafting, states that a second pipeline would be an infructious investment.

It may be noted that when GAIL laid its first-ever pipeline, it assumed that a capacity of 18 million metric standard cubic metres of gas per day was sufficient. Then it expanded to 33 mmscmd. By the time that expansion was complete, it was already planning to double capacity. The demand-supply gap is such that the gas transport market needs to minimally double capacity inside the next five years. Supreme Court judgments over the past few years also clearly point to the need to beef up city gas distribution networks across every metro-semi-metro in order to create public transport services that operate off less polluting CNG.

But any such investment in a new gas pipeline (unless it’s by Gail perhaps) would be infructious if said pipeline happens to fall within the service area of an extant pipeline. If this is the best Act that a multitude of drafts could produce, the lunacy must be both infectious and infructious across the stakeholder universe.


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