Kerala to mull way out after apex court stops KSRTC subsidy

The Kerala government will examine what can be done after the apex court Monday set aside a state high court ruling for maintaining subsidy to the state road transport corporation, a minister said.

The apex court ruled that no subsidy be provided to the Kerala State Road Transport Corporation (KSRTC) from Monday onwards.

Kerala Transport Minister Aryadan Mohammed said he will speak to the central government and the state cabinet.

"I will take up this issue with the cabinet in its next meeting in the wake of the ruling that came from the apex court today as we are committed to the people. As a result of withdrawing the subsidy, the KSRTC will incur an additional expense of Rs.22.60 crore every month," he said.

In March 2013, the Oommen Chandy government approached the high court seeking a directive to all oil companies in the state that they should supply diesel to the KSRTC at subsidised rates taking into account that it is a public utility.

The court then ruled in favour of the state government and oil companies continued to supply fuel at subsidised rates, but approached the apex court against the ruling.

In its judgment, the apex court pointed out that there is no need for providing fuel at subsidised rates to the KSRTC and attributed the transport undertaking's losses to mismanagement.

It asked what was the need for providing free travel to law-makers and journalists by the state owned transport corporation.

It also pointed out that the KSRTC should look into ways of increasing its revenues by hiking the fares if necessary as one cannot turn a blind eye to the huge losses incurred by the oil companies on account of importing fuel to meet the country's needs.

The ruling has come as a shock to the corporation as its gross operating loss has crossed Rs. 350 crore in the current fiscal. At times, the state government pumps in money to keep the corporation afloat.