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Mumbai: The government will issue oil bonds worth Rs23,457 crore to partly
compensate public sector oil companies for the losses incurred on fuel sales and
keep prices of petrol and diesel stable, petroleum minister Murli Deora said after
a cabinet meeting.The
government also extended subsidies on fuels used by the poor by three years. "The
total under-recovery on fuel sales is estimated at Rs54,935 crore, Of this, 42.7
per cent is being borne by the government by way of issuing oil bonds,'''' Deora
said. "Upstream
firms will share 35 per cent of the total under-recoveries and downstream sector
will bear 22.33 per cent," an oil ministry official said. The
government will issue the first tranche of bonds worth Rs12,000 crore on October
13, the official said. The
government is expected to incur a revenue loss of Rs54,935 crore for the whole
of fiscal 2007-08 on account of discounted fuel sales. India,
which imports 70 per cent of its crude oil requirements, last raised fuel prices
to reflect higher crude rates in June 2006 but has subsequently rolled back the
increase. Crude
prices are currently ruling around $81 a barrel.
also see : General
reports on Economy
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