The Centre is working out a solution with the Oil & Natural Gas Corporation (ONGC) to announce a cut in diesel and petrol prices. A meeting was held late Thursday, sources said, at Petroleum Minister Dharmendra Pradhan’s residence.
Asked when the government could decide on the cut, an official told The Indian Express that the announcement could come any time.
On May 24, The Indian Express had reported that the government is working on getting ONGC to shoulder the burden of rising fuel prices as it is reluctant to cut the excise duty levied on petrol and diesel.
The government’s plan was to direct ONGC to sell its crude oil at below ruling international prices by capping the price for the entire fiscal year. Oil India Ltd, the other national oil producer, will not be a part of this scheme.
ONGC supplies an estimated 20 per cent of the country’s total crude oil requirement to refining and marketing companies IOC, HPCL and BPCL. ONGC had asked for a higher price to fund its capital expenditure for the next two years.
Incidentally, ONGC and OIL last contributed to fuel subsidies in June 2015 with contributions of over 40 per cent of the annual subsidy bill.
There was a 19-day freeze in revising rates before Karnataka went to polls. Fuel prices have gone up significantly since the time the hiatus ended on May 14.
Meanwhile, a PTI report from Indore quoted Union Minister Piyuish Goyal as saying that the Centre is working on a long-term plan to provide relief from rising fuel prices. “International crude oil prices have risen sharply in recent times, which have impacted the prices of petrol and diesel in the country…The Centre, in consultation with states, is making a long-term plan so that the prices could be reduced and controlled in future,” Goyal said.
Asked for details of this plan and when it would be introduced, the minister said, “We will announce it at the right time.”
On the demand of bringing petroleum products under the Goods and Services Tax (GST), Goyal said, “I hope there will be a discussion on bringing petroleum products under the new tax regime at the next meeting of GST Council.”