On the heels of import duty waiver on naphtha by the Centre, the West Bengal Government is planning further boost to Haldia Petrochemicals by resuming the sales tax remission scheme on sale of motor spirit.

The scheme, offered to HPL as part of incentives to industrial investment in the State, was withdrawn in 2005.

Together with import duty waiver, the sales tax remission would boost the HPL bottomline by up to Rs 700 crore annually. The joint sector company had lost Rs 240 crore in April-June 2011 quarter as against a net loss of Rs 276 crore during the entire 2010-11.

Talking to newspersons after a meeting with the State Commerce and Industry Minister, Mr Partha Chatterjee, this afternoon, the HPL Vice-Chairman and the Chairman of private promoter The Chatterjee Group (TCG), Mr Purnendu Chatterjee, said: “We are hopeful it (sales tax remission) it will be solved very soon in collaboration with the State Finance Ministry.”

The TCG group previously filed a petition before the Calcutta High Court challenging the State Government's decision.

Ownership issue

Though Mr Chatterje did not comment on the ownership issue, which was awaiting verdict of the Supreme Court, the State Commerce and Industry Minister later said: “We have full confidence on the Court. If, someone wants to expedite matters, then we are open to ideas.”

Sources, however, suggest that both sides have agreed to wait for the Court to resolve this critical issue.

It may mentioned that unless the ownership issue is resolved, HPL cannot attempt either restructuring its Rs 3,300 crore loan portfolio or raise finances for the proposed downstream projects entailing an investment of Rs 4,000 crore.

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