India plans 50% increase in oxygen production before third COVID-19 wave

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Spread of the coronavirus disease (COVID-19) in Kolkata

By Shivani Singh

BENGALURU (Reuters) - India aims to ramp up its medical oxygen production capacity to 15,000 tonnes per day before a potential third wave of coronavirus infections that is expected to hit the country as soon as mid-September, an industry executive said.

The target implies a 50% jump from the maximum output of almost 10,000 tonnes reached earlier this year during the peak of the second COVID-19 wave, when hospitals ran short of the gas and relatives of patients had to search out oxygen cylinders.

Linde India supplied nearly one-third of the total oxygen demand during the peak.

Moloy Banerjee, head of Linde South Asia, said that while the government is targeting 15,000 tonnes of medical oxygen per day, Linde and other manufacturers were hoping to hit production of at least 13,500 tonnes per day ahead of the third wave.

As of Monday, India's total COVID-19 cases had reached 33.03 million, with the death toll at 440,752, according to health ministry data.

While demand for medical oxygen in India has considerably reduced since the peak, reaching near pre-COVID levels, gas companies along with the government are gearing up for a scenario where the third wave could be worse than the previous one.

The New Delhi government said last month it will increase oxygen production by setting up new manufacturing units or expanding the production capacity of existing units for uninterrupted oxygen supply during a health crisis.

Shares of Linde India rose to record levels in the days following the Delhi government's notification and have more than doubled for the year as of Monday's closing price.

"There have been discussions with the Delhi government since the second wave of COVID-19. We are still reviewing the policy and trying to see if it is workable for Linde," Banerjee added.

The company has not entered any formal agreement with the government.

Linde has also been in touch with the governments of Andhra Pradesh and Madhya Pradesh states to support setting up of additional oxygen storage capacities and manufacturing units.

(Reporting by Shivani Singh in Bengaluru; Editing by Angus MacSwan)

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