MINISTER OF STATE IN THE MINISTRY O`F PETROLEUM AND NATURAL GAS (SHRI DINSHA PATEL)
(a): The profits of public sector Oil Marketing Comparaes(OMCs) viz. Indian Oil Corporation Ltd.(IOCL), Bharat Petroleum Corporation Ltd. (BPCL), Hindustan Petroleum Corporation Ltd. (HPCL) and IBP Co. Ltd. have declined substantially due to subsidy on petroleum products. However, these companies would have incurred heavy losses but for the subsidy sharing mechanism implemented by the Government by which the subsidies are shared by tlse upstream companies and the Government.
The profit after tax reported by IOCL, BPCL, HPCL and IBP Co. Ltd. for the
financial years 2003-04, 2004-05 and for tbe period April-Dec`05 is tabulated
below; ¦
(Rs. in crore)
Name of Oil Company 2003-04 2004-05 Aprii-Dec`05
IOCL 7005 4891 890
BPCL 1694 966 (1659)
HPCL 1904 1277 (1608)
IBP Co. 215 59 (521)
(c):
The following steps have been taken by the Government in this regard without hurting the interest of consumers:
too
#Roll back in excise duty on petrol from 26% to 23% and on diesel from 11%
to 8% from 19.8.2004 coupled with reduction in the customs duty on petrol
and diesel from 20% to 15%. Similarly, excise duty on PDS kerosene was
scaled down from 16% to 12% and customs duty on LPG and Kerosene from
10% to 5%.
#Customs and excise duty on PDS Kerosene and LPG packed domestic has
been made nil from 1.3.2005. This has been done to reduce the under
recoveries of oil companies on these products, ;,.
#The customs duty on petrol and diesel has been reduced from 15% to 10%.
The customs duty on ATF, FO (for general use), LSHS (for general use) and
Bitumen has been reduced from 20% to 10% from 1.3.2005. Simultaneously,
the customs duty on crude has been reduced from 10% to 5%. The excise duty
on petrol has been revised from 23% plus Rs.7.50 per litre to 8% plus
Rs.13.00 per litre and on diesel from 8% plus Rs.1.50 per litre to 8% plus
Rs.3.25 per litre.
#Sharing of losses of the OMC`s on domestic LPG and PDS kerosene with the
upstream companies namely GNGC, Oil and GAIL.
#In the Union Budget 2006-07, the Government categorised domestic LPG as
`declared goods` under Sales Tax Act. This will reduce the sales tax/VAT
levied by States to 4%. This is also expected to marginally reduce the under-
recoveries of oil marketing companies without increasing retail selling prices
of domestic LPG.
#In view of losses/under-recoveries suffered by Oil Marketing Companies
(OMCs) in marketing LPG (domestic) and PDS Kerosene, during the financial
year 2005-06, the Government has issued Bonds worth Rs. 11,500 crores to
OMCs.
