RTC buying diesel from private pumps - The New Indian Express

RTC buying diesel from private pumps

Published: 26th January 2013 08:32 AM

Last Updated: 26th January 2013 08:32 AM

In a bid to overcome an additional burden of Rs 714 crore placed on it by the withdrawal of subsidy on bulk purchases of diesel, the AP State Road Transport Corporation has begun buying diesel in retail from private petrol pumps across the state.

Acting on instructions from their higher-ups, all RTC depot managers have started buying diesel on retail basis from petrol pumps at their places since Wednesday. The corporation is able to avoid the additional expenditure of Rs 2 crore a day, which it would have incurred on bulk purchasing,  because the diesel sold in retail by petrol pumps is subsidised. Thus the RTC is able to get the required fuel at the subsidised rate.

The central government’s decision to withdraw the Rs 12 subsidy on a litre of diesel for bulk buyers placed an additional burden of Rs 714 crore a year on the RTC which is already steeped in a Rs 4,000-crore loss due to increasing costs of maintenance, fuel and salaries. The APSRTC is in the bulk purchaser category because it purchases about 50 crore litres of diesel in a year.

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