Centre plans package to give relief to oil companies

Diesel

Sales tax7.743.81 Customs1.832.23 Excise15.024.76 Total taxes24.5910.8 Without taxes20.9320.96 Total45.5231.76 Source: Petroleum Planning & 
Analysis Cell                                       (Rs/litre) 
Other senior ministers of the government, present at a function held at the prime ministers' residence to mark four years of the United Progressive Alliance government, also said a price hike was not on the agenda of a scheduled meeting of the Cabinet here tomorrow. In fact, oil ministry officials claimed the ministry was yet to move a draft note for the consideration of the Cabinet.  Petroleum Minister Murli Deora has called a meeting of heads of the state-owned oil companies tomorrow to discuss the price issue. Today he said there was not an iota of truth in reports that fuel was being rationed. "Such news leads to hoarding. I have spoken to BPCL chairman Ashok Sinha who has categorically denied such a move," he said.  In response to a question on inflation, the prime minister said: "It is wrong to look at the week-on-week movement of the index. If you look at the annual figures, the trend rate is on a decline. There is a deceleration in inflation."  He had earlier forecast that inflation would moderate in 8-10 weeks from now. He refrained from commenting on what a comfortable level of inflation was in his view, but added there was always an element of seasonality with prices rising between May and September.  Earlier this week, the Reserve Bank of India said inflation was unacceptable and pointed out that official data underestimated the actual rate of inflation. The inflation rate rose to 7.83 per cent in the week ended May 3, the highest since November 2004. The RBI aims at an annual inflation rate of 5-5.5 per cent for 2008-09.  The surge in international crude oil prices, coupled with the administered pricing, has meant that blue-chip public sector firms like Indian Oil, Hindustan Petroleum and Bharat Petroleum have taken a hit in their profitability.  The under-recoveries on the sales of petrol, diesel, kerosene and cooking gas are projected at a massive Rs 1,80,000 crore in 2008-09. For 2007-08, the companies have been issued bonds worth Rs 20,000 crore, with another Rs 15,000 crore set to be issued soon. No decision has yet been taken on the quantum of bonds for 2008-09, oil ministry sources added.