• PAGE ONE
• INDEX
• HOME

No roll-back on price hike: Naik

Our Bureau

MUMBAI, March 24

MR. Ram Naik, the Union Minister for Petroleum & Natural Gas, today ruled out any roll-back in the hike in price of kerosene and LPG.

``There will be no roll-back,'' he said, adding, ``I think Mr. Chandrababu Naidu should understand our difficulties in raising the prices, and he will.''

However, the prices of the five controlled products - superior kerosene oil, LPG, motor spirit, high-speed diesel and aviation turbine fuel would be reviewed after the OPEC countries' scheduled meeting of March 27.

Mr. Naik was addressing a press conference on the high level sectoral report `Vision 2025', here.

He said that the oil pool deficit may go up to Rs. 19,000 crores at current prices, an unsustainable level for the economy. In spite of the price hike, the deficit is expected to be Rs. 13,000 crores by next year end.

The decision to increase prices of PDS kerosene in instalments and to reduce LPG subsidy was first suggested by an expert technical group appointed by the Narasimha Rao Government.

An agreement between the energy ministries of the US and India is in the offing, as part of the official India visit of the US President, Mr. Bill Clinton. Details would be announced later, Mr. Naik said.

On divestment in oil PSUs, he said the Government was in no hurry as all oil majors were profit-making units. He refused comment on the fate of stand-alone refineries as also the ongoing disinvestment process at Indian Petro Chemicals Ltd (IPCL). Any dec ision would be taken after studying each case independently, he said.

Referring to the Centre's plans to sell the freight container business of the State-owned Balmer Lawrie & Company Ltd at Kochi, Mr. Naik said: ``The unit has been making losses after large scale dumping by China in the container market.''

On the scheduled dismantling of the administrative price mechanism in two years, he said that India was the only country in the region with such disparate pricing for diesel and kerosene. ``Kerosene should ideally be subsidised up to 33 per cent and LPG, up to 15 per cent,'' Mr. Naik said.

After the dismantling of the administrative pricing mechanism, prices of petroleum products would be under the purview of the Finance Minister and not the Petroleum Minister, he added.

The Minister, along with 27 other MPs, will be visiting ONGC's Bombay High refinery early next week before finalising restructuring plans worth Rs. 3000-4,000 crores for the plant.

``Public sector units such as ONGC, IOC and GAIL can pool in their resources for this restructuring. But if necessary, joint ventures can be formed for the project,'' he said. The proposed restructuring is necessary to ``improve upon'' the depleting quan tity of gas extracted from Bombay High, he said.