New Delhi: The Government will issue the first tranche of oil bonds worth Rs 5,750 crore by Wednesday and a second trance by March 15 in order to tide over the crisis of oil pool deficit, which has put oil companies under tremendous pressure.
The decision was taken after a meeting between Petroleum Minister Murli Deora and Union Finance Minister P Chidambaram on Monday afternoon. According to sources, Deora urged the Finance Minister for higher subsidies on the oil account to cut down the losses suffered by the oil companies.
While talking to reporters, Deora, however, declined to comment on the timeline for a package from the Finance Ministry for the oil companies. He also refused to comment of an imminent fuel price rise.
The oil sector was expecting rationalisation of duties in the Budget, as had been suggested by Rangarajan Committee to help the retailing firms which posted a net loss of Rs 2,898 crore in the first nine months of the fiscal 2005-06.
The Budget neither hiked subsidies nor rationalised the duties, although it did lower the central sales tax on LPG.
The Rangarajan panel had suggested a steep hike of Rs 75 per cylinder in LPG price and an increase of Rs 1.21 per litre in petrol price and Rs 1.96 per litre in diesel price.
On taxation, it had recommended a revenue-neutral rationalisation wherein customs duty on petrol and diesel was to be cut to 7.5 per cent from current 10 per cent.
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