Even as the union cabinet recently approved the  hike in domestic natural gas price to $8.4 million metric British thermal unit (mmbtu) from April 2014, the government does not stick to any fixed price, some media reports indicate.

According to these reports, the government has left the market condition to fix the price based on the formula proposed by the Rangarajan committee.

The committee suggested that the price of domestic gas be fixed based on the average of net back price of Indian gas imports and the weighted average of the price at international hubs.

On the basis of this formula, the price for natural gas in India for the quarter April-June 2013 comes to $6.83 per mmBtu.

While the current gas price comes to around $6.83 mmBtu, the price in April 2014 based on this formula will depend on circumstances at that time in the global gas market.

Thus, media reports indicate that the government has approved the Rangarajan committee formula rather than any fixed price.