New Delhi, Oct 31 (IANS) The Opposition Wednesday demanded that Prime Minister Manmohan Singh answer allegations that losses were caused to the exchequer as his government agreed to Reliance Industries Ltd's demand for a hike in price of gas from the Krishna-Godavri basin.

Although both the Left and the BJP came down on the government, the Left parties also hit out at the BJP, saying that the agreement with the company was signed during the rule of the National Democratic Alliance (NDA).

India Against Corruption activists Arvind Kejriwal and Prashant Bhushan alleged that the UPA government had agreed to the demand of the Mukesh Ambani-led Reliance Industries for hike in gas prices in 2007 to $4.2 per unit, despite an agreement signed in 2004 to supply gas to the National Thermal Power Corp for next 17 years at $2.5 per unit.

Hours after the allegations were made by the activists, the BJP targeted the government.

BJP spokesperson Rajiv Pratab Rudy said that many of the issues raised by IAC members were already in the public domain. He said that party leader Jaswant Singh had also issued a statement on how the government had found it convenient to raise the price of gas, and questioned the removal of Jaipal Reddy from the petroleum and natural gas ministry in Sunday's reshuffle.

Rudy said the activists had mentioned that RIL had signed a contract with National Thermal Power Corporation in 2004 for supplying gas at around $2.2 per unit for 17 years.

"This is fundamental. How was it changed... people would like to understand," he said.

He said that all the facts in the matter should be out in the public domain, as people deserve an answer.

"The prime minister should tell us why the decision was changed," he said, adding that there were allegations of huge loss to exchequer.

Asked about activists playing an audio clip containing voices of Ranjan Bhattacharya, foster son-in-law of former prime minister Atal Behari Vajpayee and former corporate lobbyist Nira Radia, Rudy said it was a private conversation.

"It is a private conversation... I would not like to take that into reference," Rudy said. Another BJP leader, Mukhtar Abbas Naqvi, said that it was not necessary to react to every allegation from activists who adopt "hit and run" tactics. He added, however, that if there was anything to the allegations, the matter could be probed by an appropriate authority.

Naqvi said that the government's resolve to fight corruption was "weak".

Communist Party of India-Marxist (CPI-M) leader Basudeb Acharia said controversies concerning supply of gas by Reliance Industries were not new, and demanded an answer from the prime minister.

"Jaipal Reddy was removed because he resisted (the hike). The agreement (with Reliance Industries) was signed during the National Democratic Alliance rule and the price was increased during UPA rule. Both are responsible," Acharia told IANS.

He said the party would raise the issue in the winter session of parliament. Communist Party of India leader D. Raja said allegations concerning Reliance Industries pertained to the rule of the NDA and the UPA. "Both BJP and Congress should clarify," he said.

Kejriwal and Supreme Court lawyer Prashant Bhushan Wednesday alleged that Jaipal Reddy was removed as petroleum minister in Sunday's reshuffle for not agreeing to the demand of Reliance Industries to hike the charges of the gas it was supplying to state-owned power plants.

They said KG basin was awarded to Reliance Industries in 2000 by the NDA government on terms favourable to the company. IAC leaders said the hike in gas price in 2007 had led to an undue benefit of Rs.8,000 crore to RIL.

They accused the company of "hoarding" gas by reducing output and said it wanted the price to be further hiked to $14.25 per unit.

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