In a major relief to oil marketing firms, the Government released Rs 7,000 crore to the three public sector oil marketing companies, Indian Oil, Hindustan Petroleum and Bharat Petroleum, as part of the compensation owed to them towards selling diesel, LPG and kerosene below cost.
A senior Government official told Business Line , “The three oil companies are scheduled to get Rs 38,500 crore to cover under recovery for January-March quarter of 2011-12.
First instalment
The first instalment was released on Tuesday. Four more equal instalments will be paid with a gap of one or two days between each. The last instalment will be of Rs 3,500 crore.”
It is a normal practice that subsidy payment for January-March quarter of last fiscal is done during April-June quarter of the following fiscal.
The three state-owned companies are estimated to have lost Rs 41,000 crore during January-March quarter of 2011-12.
For the fiscal year as a whole, this loss is estimated to touch Rs 1.38 lakh crore. Under recovery relates to selling diesel, domestic cooking gas (LPG) and kerosene below cost. Meanwhile, the Petroleum Ministry said that the for the fortnight beginning June 16, under recovery on diesel has come down a bit but remained at the same level for kerosene and LPG.
Under recovery on diesel has come down to Rs 10.20 a litre from Rs 12.53 a litre.
In case of PDS kerosene and domestic LPG the under-recoveries remain same (Rs 30.53/Litre and Rs 396.00/cylinder respectively). The under-recoveries are computed on monthly basis in respect of PDS kerosene and domestic LPG.
The three state run oil marketing companies are currently incurring daily under-recovery of about Rs 446 crore on the sale of diesel, PDS kerosene and domestic LPG.