The Committee on Feedstock Policy and Pricing for Petroleum, Chemicals and Petrochemical Investment Regions, headed by Petroleum Secretary has identified Dahej in Gujarat, Vizag in Andhra Pradesh, Kochi in Kerala, Haldia in West Bengal, Mangalore in Karnataka, Paradip in Orissa and Panipat in Haryana for setting up of petrochemical hubs.
Each hub must include a refinery and petrochemical plant with downstream chemical units. To provide incentives for PCPIRs for domestic market sales, no further change is recommended to be made in customs tariff of petroleum products along with reduction in crude oil duty to nil. It is also recommended that to increase availability of domestic naphtha, and in order to eliminate tariff induced infructuous trade movements, there is a case for treating naphtha supplies for polymers use/petrochemicals as deemed exports with attendant duty drawback benefits for refineries. It has been recommended that the government provide a stable tax regime in terms of Central, State, local and income taxes for 10-15 years; an appropriate mix of capital grants or soft loans; tariff incentives for their domestic sales; and automatically apply SEZ norms to further the development of PCPIRs.
Expansion of Hindustan Petroleum Corporation's refinery at Vizag to 15 million tons would make 1.6 million tons of naphtha available. Kochi PCPIR could get naphtha from Kochi Refineries Ltd and LNG to be imported by Petronet LNG Ltd. Mangalore Refinery and a new LNG terminal could support a PCPIR at Mangalore while Haldia refinery and refineries in Northeast and Barauni could aid a PCPIR at Haldia.
02-May-06 
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