Government owned Indian oil companies IOC, HPCL and BPCL losing Rs 640 cr per day from sales of subsidized petrol, diesel, LPG and kerosene – headed for a catastrophe?
Preeti Menon
Apr. 14, 2008

Government owned Indian oil companies IOC, HPCL and BPCL are losing Rs 640 cr per day from sales of subsidized petrol, diesel, LPG and kerosene. Rs 640 crore per day translates into $150 million per day or $4.5 billion per month. How long can India sustain a loss of $50 billion per year trying to subsidize the petroleum products to create a false hope of contained inflation?

Many think tanks believe the imminent catastrophe is in the happening. India is financing the oil subsidies to its own citizens through budget deficit that it out control according to all international standards. Indian trade and budget deficits continue to grow exponentially.

In 2007-08 the Indian government owned oil company gross refinery margins are expected to be around $10 to $11 per barrel. Their borrowings as of March 31, 2008 have risen to Rs 34,000 cr. – a historical high.

Government owned Indian oil companies IOC, HPCL and BPCL losing Rs 640 cr per day from sales of subsidized petrol, diesel, LPG and kerosene – headed for a catastrophe?
Preeti Menon
How long can India sustain a loss of $50 billion per year trying to subsidize the petroleum products to create a false hope of contained inflation?
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