The APSRTC is feeling the pinch of hike in diesel prices. The fuel budget has shot up manifold in the West Godavari region of the RTC on account of the difference of prices at the private filling stations and the rates fixed by oil companies for bulk users, such as road transport corporation. The RTC receives fuel supplies at Rs.62 a litre from oil companies even as it is available for Rs.51 a litre at private filling stations.

In a bid to insulate itself from the price shocks, the RTC seems to have found an escape route by having its fleet of bus services fuelled at private filling stations. “We are saving Rs.11 per litre by purchasing fuel from private filling stations,” says Rama Rao, Regional Manager of the APSRTC. The RTC with a fleet of over 500 bus services in the district consumes 40,000 litres of diesel, which is supplied by the oil companies directly and filled in the storage tanks at its garages.

The price of diesel supplied for the bulk users was hiked by Rs.11 per litre while the increase for retailers was only 62 paise. The burden is unbearable for RTC which is already in losses, says Mr. Rama Rao. The situation for the RTC turned from bad to worse with the levy of 23 per cent of value added tax on the fuel when it is only four per cent in the case of airlines and the railways.