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HindustanTimes Thu,28 Aug 2014

Petroluem Ministry seeks protection, duty-free LNG

Reuters, PTI  New Delhi, February 18, 2003
First Published: 18:12 IST(30/1/2003) | Last Updated: 14:57 IST(18/2/2003)
The Petroleum Ministry has asked the Finance Ministry not to expose Indian refining firms to competition from cheap imports and sought duty-free import of liquefied natural gas (LNG), officials said on Thursday.

At present, customs duty is 10 per cent on crude and 20 per cent on oil products.

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The Petroleum Ministry's demand follows a recommendation of a panel of top Finance Ministry officials that the duty differential between crude oil and products should be halved.

The panel's report will be considered while preparing the Budget 2003-04 proposals.

Petroleum Minister Ram Naik and Finance Minister Jaswant Singh discussed taxation issues for the Petroleum Ministry on Thursday.

"The two ministers held pre-budget discussions today. The Finance Minister will examine the suggestions from the petroleum industry," a government official told Reuters.

India exports petrol and diesel but Essar Oil, which is building a refinery, has sought permission to import petrol and diesel and retail the fuels untill its own refinery is built.

The Petroleum Ministry has also sought duty-free import of LNG, which currently attracts a five-per cent levy.

India has contracted to buy five million tonnes a year of LNG from Qatar. LNG will arrive at Dahej in Gujarat in December but Petronet LNG, which is buying the gas from Qatar, has still not found a single buyer as customers find it too expensive.

Petronet LNG is promoted by state-run oil firms and the oil ministry, which controls these companies, is seeking tax concessions to make the project viable.


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