Diesel deregulated, prices cut by Rs 3.37 a litre

October 18, 2014

New Delhi, Oct 18: In much-awaited reform, the government on Saturday deregulated diesel prices, a move that will result in a price cut of Rs 3.37 a litre with effect from midnight tonight.

Diesel deregulatedFinance Minister Arun Jaitely said the Cabinet in its meeting today decided to deregulate or free diesel prices. Retail rates will now reflect international movement in oil prices.

As a result, rates will be cut by Rs 3.37 a litre with effect from midnight tonight.

This is the first reduction in diesel rates in over five years. Diesel rates were last cut on January 29, 2009 when they were reduced by Rs 2 a litre to Rs 30.86.

Diesel prices were last raised by 50 paisa on September 1 and cumulatively risen by Rs 11.81 per litre in 19 instalments since January 2013.

There couldn't have been more opportune time for the decision. Oil prices are near a four-year low and two major state elections are out of the way.

Reserve Bank Governor Raghuram Rajan has recently called on the government to "seize this moment", while inflation is the lowest in five years and refiners are selling at a profit for the first time ever.

Brent crude has fallen 25 percent this year to around USD 83 per barrel and expectation is that it may not cross USD 100 barrel anytime soon.

The process was set in motion by the previous UPA government when it eliminated controls on petrol prices in 2010 and in January last year decided to raise diesel prices by up to 50 paisa a litre every month.

The result has been that petrol prices have moved in tandem with global cost and retail rates being reduced on five occasions since August on falling oil rates. Prices have cumulative come down by close to Rs 7 per litre in last two-and-half months.

On diesel, the entire under-recovery or loss has been eliminated and oil firms started making profit from second half of September. The over-recovery or profit has since reached Rs 3.56 per litre.

Deregulation would mean that the government and state-owned explorers including Oil and Natural Gas Corp (ONGC) are no longer subsidising diesel.

Finance Minister Arun Jaitley had budgeted Rs 63,400 crore for petroleum subsidies which was 25 per cent lower than previous fiscal. But unlike past, the subsidy bill is unlikely to overshoot the budgeted amount due to fall in oil rates.

Oil subsidy account for a quarter of Rs 2.51 lakh crore.

Originally, petrol and diesel prices were deregulated in April 2002 when the NDA government was in power. Administered pricing regime, however, made a back-door entry towards the end of NDA regime in the first quarter of 2004 when crude prices started inching up.

The Congress-led UPA controlled rates as international oil prices went through the roof. In June 2010, however, it freed petrol price from its control and rates have since then moved more or less in tandem with cost.

It had in-principle decided to deregulate diesel, which is used in everything from cars and trucks to back-up power generators and agricultural water pumps. The fuel accounts for 43 per cent of the nation's fuel consumption.

In January 2013, the then UPA government decided to deregulate diesel prices in stages through a monthly 50 paise a litre increase. Rates were last hike on September 1 after which losses have been wiped off.

It is estimated that under-recovery or revenue loss on selling diesel, LPG and kerosene at prices lower than imported cost this fiscal will be around Rs 86,080 crore.

This will have to be met by cash subsidy from government as well as dole from upstream oil producers like ONGC.

The under-recovery estimate for the current fiscal is lower than Rs 1,39,869 crore of last fiscal. In 2013-14, the government had provided Rs 70,772 crore by way of cash subsidy while upstream firms picked up Rs 67,021 crore tab.

Sources said the under-recovery in (April-June) was Rs 28,691 crore. This was mostly met by Rs 11,000 crore cash subsidy from the government and Rs 15,547 crore coming from ONGC, Oil India Ltd and GAIL. The remaining Rs 2,144 crore was absorbed by fuel retailers (IOC, BPCL and HPCL).

In second quarter, the under-recovery is estimated at Rs 21,198 crore with diesel accounting for Rs 2,848 crore as compared to Rs 9,037 crore in the June quarter. Kerosene under-recovery was Rs 6,950 crore (Rs 7,524 crore in Q1) and LPG was Rs 11,400 crore (Rs 12,129 crore in Q1).

While diesel losses have been wiped off, oil firms lose Rs 31.22 a litre on kerosene and Rs 404.64 per 14.2-kg LPG cylinder.

Sources said government had provided Rs 1,00,000 crore cash subsidy in 2012-13 when under-recoveries touched an all- time high of Rs 1,61,029 crore. In the preceding year, Rs 83,500 crore was given. Upstream firms had chipped in with Rs 60,000 crore in 2012-13 and Rs 55,000 crore in 2011-12.

Comments

Floy
 - 
Tuesday, 22 Mar 2016

Hi there, just became aware of your blog through Google, and found that it's
truly informative. I'm gonna watch out for brussels.
I'll be grateful iif you continue this in future. Many people will be
benefited from your writing. Cheers!

my web page - self storage hiram ga: http://www.brownbook.net/business/39277916/harry-chesney-llc

Add new comment

  • Coastaldigest.com reserves the right to delete or block any comments.
  • Coastaldigset.com is not responsible for its readers’ comments.
  • Comments that are abusive, incendiary or irrelevant are strictly prohibited.
  • Please use a genuine email ID and provide your name to avoid reject.
News Network
March 20,2020

New Delhi, Mar 20: Bodies of the four Nirbhaya convicts who were hanged on Friday morning at Tihar Jail have been sent to hospital for a post-mortem, following which it will be handed over to the families, according to an official.

After the hanging at 5:30 am today, the bodies were taken from Tihar Jail to Deen Dayal Upadhyay (DDU) Hospital for post mortem at around 8:20 am.

Tihar jail Director-General Sandeep Goel said that the bodies will be handed over to the families after the post mortem.

The families, however, will have to give a written undertaking that they will not make a public demonstration of the cremation or burial of the executed person.

The superintendent will also consult the District Magistrate and the Deputy Commissioner of Police for arrangements for the disposal of the body.

The post mortem comes in line with the Supreme Court's order in Shatrughan Chauhan's case in January 2014, which had mandated the same observing that there is a dearth of experienced hangman in the country.

"By making the performance of post mortem obligatory, the cause of the death of the convict can be found out, which will reveal whether the person died as a result of the dislocation of the cervical vertebrate or by strangulation which results on account of too long a drop," the apex court had said in its order.

"Our constitution permits the execution of death sentence only through the procedure established by law and this procedure must be just, fair and reasonable," the order added.

All four convicts in the 2012 Nirbhaya gang-rape and murder case -- Akshay Singh Thakur, Pawan Gupta, Vinay Sharma, and Mukesh Singh -- were hanged till death at 5:30 am this morning.

The case pertains to the brutal gang-rape and killing of a 23-year-old paramedical student in a moving bus on the night of December 16, 2012, by six people including a juvenile in the national capital. The woman had died at a Singapore hospital a few days later.

One of the adults accused had allegedly committed suicide in the prison during the trial, while the juvenile was released from a correction home after a period of three years.

Comments

Add new comment

  • Coastaldigest.com reserves the right to delete or block any comments.
  • Coastaldigset.com is not responsible for its readers’ comments.
  • Comments that are abusive, incendiary or irrelevant are strictly prohibited.
  • Please use a genuine email ID and provide your name to avoid reject.
News Network
February 29,2020

Kollam, Feb 29: Seven-year-old Devananda, whose body was found in a lake, was laid to rest at Kudavattoor in the Kollam district of Kerala on Friday evening.

She was laid to rest near her father Pradeep Kumar's house in Kudavattoor. Earlier, the body was kept at her mother Dhanya's house in Ilavoor and Vakkanadu school, where she studied in Class 1, for the public to pay respect.

Hundreds of people visited to pay their last respects to the child.

An intense social media campaign was launched to trace the child after she was reported missing on Thursday morning.

According to police, an autopsy conducted in Thiruvananthapuram Medical College led to a preliminary conclusion that the cause of death was drowning. Residues of mud and silt have been found in her respiratory tract.

Signs of any kind of violence inflicted on the child have been ruled out. The body was released to the family after the autopsy.

Chief Minister of Kerala Pinarayi Vijayan and Opposition leader Ramesh Chennithala, BJP state president K Surendran were among many politicians who offered the condolences.

Many celebrities including Mammootty, Dulqar Salman, Kunchako Boban took to Facebook to pay their tribute to Devananda.

Comments

Add new comment

  • Coastaldigest.com reserves the right to delete or block any comments.
  • Coastaldigset.com is not responsible for its readers’ comments.
  • Comments that are abusive, incendiary or irrelevant are strictly prohibited.
  • Please use a genuine email ID and provide your name to avoid reject.
News Network
January 31,2020

New Delhi, Jan 31: The central government has decided that pensioners' life certificates will be collected from their doorstep, saving them from hassles of visiting pension disbursing banks.

The service will be charged an amount not exceeding Rs 60, according to a statement issued on Thursday by the Department of Pension and Pensioners' Welfare (DoPPW).

Every year a pensioner is required to give proof of him being alive to banks in order to ensure continued pension. These certificates can be submitted online or by visiting the bank.

"The department has taken a landmark step to make life easier for senior citizens to submit their annual life certificate for continued pension," it said.

Directions have been issued to all pension disbursing banks to send SMS or emails to all their pensioners on October 24, November 1, November 15 and November 25 every year reminding them to submit their annual life certificates by November 30, the statement said.

"The bank in addition will also ask such pensioners through SMS/email as to whether they are interested in submission of life certificate through a chargeable doorstep service, the charge not exceeding Rs 60, it said.

The department for stricter monitoring and in order to ensure that no pensioners are left out has also directed the banks to make an exception list on December 1 every year of those pensioners who fail to submit their life certificate and issue another SMS or email to them for submitting it.

The Central Pension Processing Cells (CPPC) of the pension disbursing banks shall now be duty bound to submit a report to the DoPPW in January, February and March.

The report will indicate the total number of pensioners who have not given their life certificate along with a breakup of the certificates submitted physically and through digital means, the statement said.

This is a landmark step from the side of the central government showing due care for pensioners, it said.

This step is in addition to the order issued in July last year, vide which all pensioners aged 80 years and above have been given an exclusive window to submit their life certificate w.e.f. 1st October every year instead of 1st November every year, the statement added.

Comments

Add new comment

  • Coastaldigest.com reserves the right to delete or block any comments.
  • Coastaldigset.com is not responsible for its readers’ comments.
  • Comments that are abusive, incendiary or irrelevant are strictly prohibited.
  • Please use a genuine email ID and provide your name to avoid reject.