The country's biggest fuel retailer Indian Oil Corporation on Wednesday said it is losing Rs 107 crore (Rs 1.07 billion) a day on selling auto and cooking fuel below cost even as it awaits the government to announce clear compensation package.
"We are losing about Rs 107 crore per day on sale of petrol, diesel, domestic LPG and kerosene below imported cost," IOC Chairman B M Bansal said. IOC and sister concerns Hindustan Petroleum and Bharat Petroleum currently sell petrol at a loss of Rs 4.97 a litre, diesel at Rs 3.27 per litre, kerosene at Rs 16.91 a litre and domestic LPG at a loss of Rs 267.39 per 14.2-kg cylinder.
These losses are after the Rs 2.71 a litre hike in petrol and Rs 2.55 per litre increase in diesel rates of last week that were primarily because of Finance Minister Pranab Mukherjee raising customs and excise duty on the two fuel.
"The industry is losing Rs 196 crore (Rs 1.96 billion) per day," he said. For the full 2009-10 fiscal, IOC, BPCL and HPCL are together projected to lose Rs 47,400 crore (Rs 474 billion) in revenues.
While the losses on petrol and diesel are met by upstream firms like ONGC, the government has not kept its promise to make up all of the Rs 31,574 crore (Rs 315.74 billion) in revenues lost on selling LPG and kerosene below cost.
Of this, Finance Minister provided an additional Rs 11,845 crore (Rs 118.45 billion), still leaving a huge deficit of Rs 19,729 crore (Rs 197.29 billion).
Bansal said IOC's losses have been pegged at Rs 16,000 crore (Rs 160 billion) and the company has been forced to go slow on new projects.
