Dealers protest government decision to subsidize diesel fuel

The Nepal Petroleum Dealers Association (NPDA) has criticized a government decision to provide diesel fuel at dealers’ price for industrial and commercial use, which the NPDA said could lead to black marketing. “The government is directly encouraging black-marketing. The huge difference in diesel price in the market is sure to encourage traders to return the oil back to the market for profit,” said Saroj Pandey, president of NPDA. Pandey pointed out that subsidizing diesel fuel means the government would lose a lot of tax revenues. Petroleum is the government’s largest revenue generating commodity. In the last fiscal year, the government raised Rs 12.82 billion (US$177.3 million) in revenues from Nepal Oil Corp. According to the Nepal Rastra Bank data, the government imported 1.05 million kiloliters of petroleum products in the last fiscal year. (February 8, 2011)