State-owned refiners get US$2.6 billion in subsidy

India’s three state-owned oil refining and marketing companies have been given Rs120 billion (US$2.6 billion) as compensation for selling fuel at government-determined rates, an oil ministry official said. The largest public sector refiner Indian Oil Corp. (IOC) gets Rs70 billion (US$1.53 billion), while Bharat Petroleum Corp. Ltd. and Hindustan Petroleum Corp. Ltd. together get Rs50 billion (US$1.95 billion), the official said. The oil ministry had made a demand of Rs220 billion (US$4.82 million) in subsidies, which the finance ministry was not willing to meet. The cash subsidies partly compensate for the losses suffered by the oil firms from selling gasoline, gasoil, LPG and kerosene at government-set prices in the first three quarters of the current fiscal year. (January 19, 2010)