Finance Minister P Chidambaram expressed confidence that the overall fuel subsidy burden during 2013-12 may not exceed Rs 80,000 crore.
The finance ministry is relying on the partial de-regulation of diesel pricing, the cap on subsidised cooking gas (LPG) and export parity pricing to reduce its oil subsidy burden by at least 80 per cent.
He said of the Rs 80,000 crore, government has Rs 20,000 crore and another Rs 60,000 crore will come from upstream companies like ONGC, GAIL India.
It may be noted that in the union budget 2013-14, the government earmarked Rs 65,000 cr for fuel subsidy during the current financial year. Of this, it will pay Rs 45,000 cr as balance compensation to the under-recovery of state-run oil marketing companies (OMCs) in 2012-13. Thus, it would be left with Rs 20,000 cr.
Meanwhile, it is learnt that the governmentÂ’s subsidy burden on petroleum products rose Rs 17,000 crore and that of upstream companies spiked Rs 5,000 crore in 2012-13, a 20 per cent rise in both.
In 2012-13, state-run OMCs incurred Rs 161,029 crore under-recovery on sale of diesel, kerosene and cooking gas at below market price.
The subsidy burden on the upstream companies — Oil and Natural Gas Corporation, GAIL India and Oil India — came down to 37 per cent from 40 per cent the previous year, from Rs 55,000 crore in 2012-13 from Rs 60,000 crore the year before.
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