Govt may use other instruments in place of oil bonds

Govt may use other instruments in place of oil bonds
ENS ECONOMIC BUREAU

NEW DELHI, OCTOBER 9: The government may not issue oil bonds to bridge the oil pool deficit but would resort to some other financial instruments. This was stated by the Minister of Petroleum and Natural Gas Ram Naik on Monday.
Briefing newsmen, Naik stated that all possibilites are being explored to bridge the remaining Rs 7,000 crore of the oil pool deficit. On being asked about the modus of servicing the bonds after the dilution of the oil coordination committee (OCC) in 2002, Naik said that even if bonds are issued it would be of tenure less than two years. "It is also possible that there would be no oil bonds and instead some other instruments would be used", he added.
The Minister also added that a decision on the issue of rollback of the hike in petro products prices will be taken by the Prime Minister after his knee surgery. "As far as I am concerned, the issue of petro prices is settled...The issue now rests with the PM. Vajpayee will take a decision on the issue after he comes back from the knee surgery," Naik added.
The Minister also lashed out at the Chief Ministers of various states for not responding to his proposal of a cut in the sales tax of petro products to give relief to the customers. "Till now non of the CMs have responded to my proposal but no response is also a type of response", he added.
Centre has asked the states to pass on the incremental differences in revenue recepits on state levies resulting from last month's decision to hike prices of petrol, diesel, kerosene and lpg to the consumers, Naik said.

Final prices to the consumers include an element of state sales tax which in some of the states is as high as 34 per cent. Whenever basic prices are increased, the ad-valorem rates of sales taxes have cascading effect on retail selling prices, he said.
Maharashtra and Andhra Pradesh had outrightly turned down Centre's request citing poor financial conditions. Naik said that he would still wait for a considered response from the states.