The government is not planning to deregulate diesel, cooking gas
(LPG) and kerosene prices by withdrawing subsidy on them, Minister of State for
Petroleum and Natural Gas R P N Singh said today.
"At present, there is no such proposal," he said in a written reply to the Rajya Sabha, when asked if the government plans to deregulate diesel and cooking fuel.
He said the government is providing subsidy of Rs 0.82 per litre on PDS kerosene and Rs 22.58 per 14.2-kg LPG cylinder from the fiscal budget.
"In addition, the public sector oil marketing companies (OMCs) also incur under-recovery (or revenue loss) on sale of diesel, PDS kerosene and domestic LPG as the prices of these products are being modulated by the Government," he said.
During 2011-12, the three OMCs lost Rs 138,541 crore in revenues on selling diesel, LPG and kerosene. To make up, the Government gave Rs 83,500 crore in cash assistance, beyond the subsidy from fiscal budget, to the OMCs while upstream firms like Oil and Natural Gas Corp (ONGC) chipped in Rs 55,000 crore. "Rs 41 crore was borne by the OMCs," he said.
Indian Oil Corp (IOC), Bharat Petroleum Corp Ltd (BPCL) and Hindustan Petroleum Corp Ltd (HPCL) currently lose about Rs 450 crore per day on sale of diesel, domestic cooking gas (LPG) and kerosene.
They are losing Rs 15.55 a litre on diesel, Rs 29.97 a litre on kerosene and Rs 231 on every 14.2-kg LPG cylinder.
The losses are besides close to Rs 3.8 per litre loss on the sale of petrol, which was deregulated in June 2010 but its rates haven't moved in tandem with cost because of government's aim to keep inflation in check.