The State Cabinet on Friday announced an urgent financial assistance of Rs.10 crore to the Kerala State Road Transport Corporation (KSRTC) to cushion its free fall into a crisis caused by the Supreme Court verdict on subsidised diesel for the public utility.
The amount will be an interim measure to meet cash down payments for diesel purchased by the KSRTC from private retail pumps till the mandatory legal and technical steps of making Kerala State Civil Supplies Corporation (Supplyco) part of the diesel supply chain are completed.
Addressing a post-Cabinet briefing here, Chief Minister Oommen Chandy said the Cabinet approved the proposal to hand over the 67 pumps owned by KSRTC to Supplyco, which would distribute diesel to not only the corporation, but also to vehicles owned by government and quasi-government institutions.
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This would bring the KSRTC out of the classification as bulk consumer and save it from paying Rs.17.40 a litre additionally.
The Rs.10-crore assistance is intended to give some flexibility to the public utility till the technical and legal issues related to the Supplyco takeover are sorted out, besides ensuring that no service is cut owing to the crisis.
Transport Minister Aryadan Mohammed had submitted detailed proposals on the interim measures to be taken and the Finance Department will examine the proposals prior to taking a decision. Listing out the technical and legal issues, Mr. Chandy said that Supplyco needed to take several licenses and permits. The regional offices of oil companies would also have to get the clearance from their head offices for expanding the pump network.
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There were practical problems such as safety issues and traffic congestions that prevented KSRTC buses filling diesel at Supplyco pumps. The current proposal was to utilise the 67 diesel pumps that would be handed over to Supplyco for supplying diesel to government and quasi-government vehicles. Depending on the ground conditions, the pumps could be thrown open to the general public, he said.
Other States had adopted different management techniques to tide over the crisis. The government had examined these during its discussions on overcoming the crisis, he said, narrating the discussions held with representatives of oil companies on helping the KSRTC tide over its fuel crisis.
The additional burden on meeting the diesel subsidy worked out to Rs.266.74 crore annually. The government did not want to take away the benefits enjoyed by employees and was making all efforts to bring out a solution within the current frame work, he said.