India to pay at least 50% of fuel subsidy

The Indian government will compensate state refiners for at least half of their revenue losses on sale of fuel at discounted rate in the local market, said Oil Secretary S. Sundareshan. Sundareshan said upstream companies, or explorers, would bear about one-third of the estimated 520 billion rupees (US$11 billion) in revenue losses of state-run fuel retailers in the current financial year. “The government in any case is committed to bear at least 50 percent of the under recoveries (revenue loss on fuel sales),” he said, adding that the payout could even go up to 67%. The government paid about 260 billion rupees (US$5.5 billion) in fuel subsidies in FY2009-2010. (July 15, 2010)