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MPs oppose IOC disinvestment

New Delhi Oct. 13. Cutting across party lines, members of Parliament in the Petroleum Ministry consultative committee have opposed disinvestment of the Indian Oil Corporation (IOC) while urging the Government to honour the Supreme Court's verdict on the Hindustan Petroleum Corporation Limited (HPCL) and the Bharat Petroleum Corporation Limited (BPCL).

Briefing reporters here today after a meeting of the consultative committee, the Petroleum Minister, Ram Naik, said, "this was the consensus". He declined to comment, however, on the Government seeking a review of the earlier decision from the Supreme Court in the context of disinvestment of another nationalised company, Jessops.

Mr. Naik, a known opponent of disinvestment in the oil sector, indicated that the MPs who expressed their views during the meeting would be prepared to accept either IOC divesting equity to the public up to 20 per cent or IOC buying equity in HPCL as the strategic buyer.

He noted that members expressed their "concern" over the prospects of disinvestment of public sector oil companies such as IOC. They also felt the Supreme Court's ruling directing parliamentary approval before disinvestment of nationalised companies should be honoured by the Government.

He said members also welcomed the decision not to raise prices of LPG and kerosene which had been taken after a review of the issue and considering the "sensitive nature" of these production. Government subsidy on these products during 2002-03 was Rs. 2.45 a litre on kerosene supplied through the public distribution system and Rs. 67.75 a cylinder on domestic LPG. Freight subsidy is also being given for supply of these of products to far-flung areas.

He said oil marketing companies in the public sector would absorb a burden of Rs. 8300 crores by not increasing prices of PDS kerosene and doemstic LPG in 2003-04. In case this decision had not been taken, he said price of a domestic LPG cylinder would have risen by about Rs. 105 and of PDS kerosene by about Rs. 3 a litre.

Mr. Naik who today became the longest lasting Petroleum Minister with an uninterrupted tenure of four years, said it has been decided to launch the ethanol blending programme in Madhya Pradesh and Uttaranchal on January 1, 2004. He also said a pilot project was being launched at Rewari in Haryana to experiment the various aspects of blending bio-diesel with diesel in Indian conditions.

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