Union Minister of Petroleum and Natural Gas Murli Deora on Friday ruled out the possibility of a “roll back” of prices of petroleum products, which had been partially decontrolled last week.
Addressing a press conference in Bangalore, Mr. Deora urged state governments “to streamline sales tax on petroleum products in a scientific manner” in order to provide relief to people affected by inflation. “In some states, the tax is as high as 30-32 per cent, while in others it is only 10-12 per cent,” Mr. Deora said.
Mr. Deora said Bihar has imposed a “new” 12.5 per cent tax on the sale of kerosene. “Even after the hike, kerosene prices in India are the lowest as compared to prices anywhere in the world,” he said.
Terming the call by Opposition parties for a strike on Monday as “unfair,” Mr. Deora said the National Democratic Alliance Government had increased kerosene prices from about Rs. 2 to Rs. 9 a litre. “In contrast, kerosene prices have been increased by the UPA Government after eight years,” he said.
The Secretary, Ministry of Petroleum and Natural Gas, S. Sundareshan said, “Even after the Rs. 3 hike announced recently, the under-recovery on every litre of kerosene is about Rs. 15.”
He said the government had decided to let petrol prices be “market driven at the refinery gate and at the retail level.” “For the first time, oil marketing companies would have the freedom to determine the price of petrol,” he said.
However, Mr. Sundareshan said the “mechanism by which this happens will be determined by the oil marketing companies in the next three or four weeks.” However, Mr. Deora said the Government would “not remain a silent spectator if any oil company overcharged consumers.”
Referring to the move to build a strategic crude oil reserve of five million tonnes, about 15 days of national requirements, Mr. Sundareshan said a capacity of about 1.33 million tonnes at Vishakhapatnam would be ready in the next 12 months. Construction of storage capacity of 1.27 million tonnes near Mangalore, and 2.5 million tonnes at Padur (near Udupi) in underground caverns, is also proceeding, he said.
The project is being implemented by the Indian Strategic Petroleum Reserves Ltd., a subsidiary of the Oil Industry Development Board, under the Ministry of Petroleum and Natural Gas.
