P Chidambaram Pegs Fuel Subsidy for Current Fiscal at Rs.20,000 Cr

New Delhi: A day after agreeing to dole out a record Rs.100,000 crore in fuel subsidy for 2012-13, Finance Minister P Chidambaram said cash payouts to oil firms this fiscal will be just Rs.20,000 crore.

At a meeting called by Prime Minister Manmohan Singh, the Finance Minister agreed to give an additional Rs.45,000 crore on top of the Rs.55,000 crore already paid to oil firms for selling diesel, cooking gas (LPG) and kerosene at government-controlled rates.

"We have done our sums and this Rs.45,000 crore is being given yesterday on account but we do not expect any more claims from the Ministry of Petroleum and Natural Gas for 2012-13," Chidambaram told reporters.

State fuel retailers had lost Rs.161,029 crore in revenues on selling diesel, domestic LPG and kerosene at government controlled rates which are way below market price.

With yesterday's Rs.45,000 crore, the government has committed to make good Rs.100,000 crore out of this.

Another Rs.60,000 crore will be chipped in by upstream firms like ONGC.

"In fact there (Oil Ministry's) own number indicated Rs.1,61,000 crore (of under-recovery or revenue loss) and if you take note of the fact that we gave them Rs.55,000 crore earlier and Rs.45,000 crore yesterday, that takes care of Rs.100,100 crore and Rs.60,000 crore (would) come from the upstream companies so thats take care of it," he said.

The additional Rs.45,000 crore payment will come out of Rs.65,000 crore budget for fuel subsidy in the current fiscal, leaving just Rs.20,000 crore.

Also, upstream firms will be expected to chip in Rs.60,000 crore, equal to what they did in 2012-13.

"Now for this year the budgeted (fuel subsidy is) Rs.65,000. We still have Rs.20,000 crore (after paying Rs.45,000 crore) and another Rs.60,000 crore will come from upstream companies," Chidambaram said.

Also Read: Learn To Renew Your Public Provident Fund Account Want To Know Richest Indian's Salary?