Oil marketing cos to get cash subsidy: Finance Secretary

Oil marketing cos to get cash subsidy: Finance Secretary Chandigarh: Finance Secretary R S Gujral on Friday said oil marketing companies, which have been facing huge under recoveries on account of subsidised diesel, LPG and kerosene, will get cash subsidies today.

"It (cash subsidy) will get released today whatever is the amount because it is the last working day (of this fiscal). I am not too sure (about actual amount)...perhaps Rs 35,000 crore in terms of cash," Gujral told reporters here today on the sidelines of PHD interactive session here.

Petroleum ministry had raised an additional demand of Rs 40,000 crore in cash subsidies for the current fiscal to compensate fuel retailers for losses incurred on diesel and cooking fuels.

Gujral said that the cash subsidies would be released after considering the total under recovery of the oil companies.

"But this is (payment of subsidy) after considering what was the total under recovery, how much government of India supported and ho much upstream companies can bear," he said.

Gujral said that a sum of Rs 20,000-25,000 crore had been given to oil companies in the first quarter of this year while Rs 15,000 crore had been agreed to be paid. "(But) they (oil companies) are asking for Rs 20,000-25,000 crore more," he said.

On petrol, he said it was up to the oil companies to take a decision on raising petrol prices as it had already been decontrolled.

"Now for petrol, they (oil companies) are free to do pricing what they like. Clearly if they have not done it (so far) that is their decision..they should not talk of under recoveries on petrol," he said.

Gujral also expressed concern over the rising crude oil prices in international market which heavily contributed in the oil companies losses.

The Finance Minister had anticipated average crude oil prices at USD 90 per barrel last year but it remained USD 115 per barrel and now it was about USD 125 per barrel, he said.

Gujral said that the Centre had reduced excise duty and custom duty in crude oil and petroleum products in June 2011, which had an impact of Rs 48,000 crore.

"In the current budget, it (duty rates) is not touched. It means government of India continues to take a hit," he said.

Asked about any relief being considered for jewellers who are protesting against the imposition of excise duty, Gujral said that Finance Minister Pranab Mukherjee had said that small jewellers were not covered under this levy.

"Jewellers who are producing and having less than Rs 5 crore (of turnover) are not covered under the new levy. Small artisans are also not covered and this is one clarification FM has given," he said.

PTI