>NATURAL GAS (KOTAK SECURITIES)

A lot at risk; urgent action needed. We believe continued tardy progress in implementation of gas development projects and new power plants may lead to the Indian gas sector performing well below its potential. We note several current and potential hurdles: Excessive government control, marathon legal cases, pricing muddle, delays in E&P and downstream development and toothless regulations. We project a steep increase in potential supply and demand by FY2015E, but both supply and demand factors will need to move in tandem to meet our projections.

■ Natural gas set to gain share in India's energy mix
■ Sharp increase in gas supply but gas development projects may get delayed
■ 'Right' price will create enough demand; power sector to account for bulk of demand
■ Regulatory developments will be crucial for growth of gas market

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