The
union finance ministry is in favour of trade parity
pricing for petroleum production, and opposes a proposal
to fix the prices of petroleum products on export parity.
The trade parity pricing was mooted by the C Rangarajan
panel, set up to suggest a pricing formula for petro
products.
Trade
parity is an average of the export and import parity
model, in a 20:80 ratio. Export parity means setting
the minimum price of a product, while import parity
includes customs duty and other levies.
The ministry opined that the export parity pricing model
would benefit only 'one private sector refiner' whose
basic market was export-oriented.
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