Concerned over the failing health of the oil marketing companies (OMCs), the Petroleum and Natural Gas Ministry has knocked at the doors of Finance Minister Pranab Mukherjee, seeking, among other things, permission to let OMCs issue long-term rupee bonds without security and also infrastructure bonds.
In its pre-Budget representation to the Finance Ministry, the Petroleum Ministry has listed out a set of financial proposals.
Under these proposals, it has argued for allowing OMCs to issue long-term rupee bonds without security. It has called for excluding subscription by banks to long-term bonds issued by OMCs from single borrower limit of banks. The Ministry has also sought to allow long-term foreign currency funds through syndicated loans and bonds into OMCs.
The Ministry wants these companies to be allowed to issue ‘infrastructure bonds' even while it has called for declaring the liquid pipeline industry as ‘infrastructure industry'. RLNG terminals, an integral link for gas pipeline to transmit imported gas, too, should be defined as ‘infrastructure projects'.
Furthermore, the Petroleum Ministry has proposed that the limit for the automatic route under ECB (external commercial borrowing) guidelines for the infrastructure sector should be increased.
It has suggested that the Finance Ministry could extend the income-tax benefit for infrastructure projects under Section 80 IA.
In addition to this, the Ministry has sought separate guidelines for foreign currency loan under export credit agency guarantee, including loan on reimbursement basis.
