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India wants GAIL to focus on building gas pipelines: minister

Reuters  |  NEW DELHI 

(Reuters) - wants state-run utility (India) Ltd to focus on laying pipelines, the minister said on Tuesday after reports about plans to spin off its marketing operations.

Splitting has been considered before, following the government's move to allow private players to enter the industry in the past decade.

"We want to focus on laying pipelines," Minister told reporters when asked about plans to split the utility.

"Our priority, and expectation from is to focus on building pipelines mainly in eastern is doing that job well. Anybody can do marketing," he added.

Many private players see GAIL's dominance in owning and operating most of the country's pipeline network as conflicting with its other role as a marketing and trading firm.

marketing accounted for 28 percent of GAIL's profit in the financial year 2016/17, while the transmission contributed 46 percent.

GAIL, formed in 1984 to build pipelines, has diversified into petrochemicals, exploration and trading. It has signed long-term purchase deals, which include 5.8 million tonnes liquefied natural (LNG) booked out of the U.S.

India, which now relies heavily on coal for power generation, is seeking to increase the use of It wants to raise the share of as an source to 15 percent from 6.5 percent.

The state-run company operates about 11,000 km (6,900 miles) of pipelines in the country that can distribute 210 million cubic metres of a day.

It is investing 202 billion rupees ($3.2 billion) to add a further 4,200 km (2,600 miles), the company's website says.

Corp and have expressed interest in acquiring

($1 = 63.7125 Indian rupees)

(Reporting by Sudarshan Varadhan; Writing by Nidhi Verma; Editing by Edmund Blair)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Tue, January 09 2018. 18:26 IST