Diesel for bulk consumers at market rates
The decision of oil companies to sell high speed diesel (HSD) to bulk consumers at market rates has plunged the Kerala State Road Transport Corporation (KSRTC) into a severe financial crisis.
With the price of HSD being sold to bulk buyers going up by Rs.9.25 a litre in Delhi from Friday, the KSRTC now has to pay Rs.60.25 for a litre of HSD compared to Rs.48.72 it had been paying till Thursday. The KSRTC needs 4.5 lakh litres of diesel a day.
The 14,000-odd private buses operating in the State, the KSRTC’s competitors, will not be affected by the decision of the Petroleum Ministry as they do not fall in the category of bulk consumers.
The loss-making corporation, which has not been able to pay the monthly pension of 37,000 retired employees till date due to a financial crisis, will now has to find an additional Rs.15 crore for the fuel bill every month, official sources told The Hindu.
Sources said the KSRTC would have to find Rs.180 crore additionally for the fuel bill annually. The decision has come at a time when the KSRTC has been exploring ways to find Rs.240 crore to make both ends meet till March 2013. As bus fares were revised only on November 11 last after a hike in the price of diesel, sources said the option of a fare hike cannot be considered now. Moreover, a fare hike will enable private operators to reap profit as they continue to get HSD on subsidised rates.
The KSRTC owes Rs.11 crore to Indian Oil Corporation (IOC) and Hindustan Petroleum (HP), two State-owned fuel majors, towards the fuel bill. The KSRTC has exceeded the credit limit of Rs.7 crore fixed by IOC and HP.
“The corporation urgently needs Rs.35 crore to pay the pension to its retired employees. The only way forward is that the government should extend financial support to pay the additional expenses to be incurred towards the fuel bill,’ sources said.
The management has conveyed the grave crisis faced by the KSRTC to the government. The corporation cannot borrow any more from the Kerala Transport Development Finance Corporation , from which it had availed of Rs.1,580 crore as loan over the years. The management has been asking the government to take over the pension liability to tide over the crisis.
As per projections, the KSRTC, with a monthly revenue of Rs.145 crore, will have a revenue-expenditure gap of Rs.85 crore. The monthly fuel bill of the fleet will be Rs.83 crore and the salary bill after the pay revision that is being implemented from January will touch Rs.53 crore. The KSRTC, which has a fleet of 6,153 buses, has a staff strength of 40,180.