Market-related pricing by 2002: Naik

By Our Special Correspondent

NEW DELHI, NOV. 24. Despite political pressure to roll back petroleum product prices, the Government is sticking to the April 2002 deadline for phasing out the administered pricing system. The process would be undertaken in a phased manner and market- related pricing will come into effect by that year.

At present, the prices of petrol, diesel, aviation turbine fuel, cooking gas (LPG) and kerosene are controlled, involving a subsidy and cross-subsidisation in some cases, while crude and refinery gate prices of most petroleum products are being determined on the basis of imported cost. According to the Minister for Petroleum and Natural Gas, Mr. Ram Naik, from 2002, only kerosene prices would be subsidised by 33.3 per cent and LPG for domestic use would get a 15 per cent subsidy. The price of diesel would be linked to the import parity price.

Mr. Naik's announcement on sticking to the 2002 deadline came at a function held here today to mark the ``India Energy Day.'' The Minister said aviation turbine fuel would be decontrolled by March 2001 and import duty on crude and other products rationalised. Also, parallel marketing of commodities of mass consumption such as kerosene and LPG by private parties had already been allowed since 1993, the Minister said. Transportation rights for petrol, diesel and aviation fuel would be given to the private companies.

By December, the Government would offer 25 oil exploration blocks to the private sector - eight each in deep and shallow waters and nine on-land. Earlier, the Government offered 25 blocks, out of which 18 were now with foreign companies which were exploring on their own or through joint ventures. According to Mr. Naik, private investment in upstream activities would be around Rs. 13,000 crores in the next five years.

In his address, the Deputy Chairman of the Planning Commission, Mr K. C. Pant, called for global cooperation in developing renewable sources of power. He pointed out that whenever global oil prices shot up, there was an increased interest in investing in research on and development of renewable sources of energy.

The Minister for Non-Conventional Energy Sources, Mr. M. Kannappan, said the Government was finalising a policy statement which would include road maps and targets for renewable energy development in the next 12 years.

The focus would be on creating an investor-friendly climate to enhance commercial energy supply.

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