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Petroleum dealers threaten stir

Petroleum dealers in the Capital threatens to go on a protest if the Delhi Govt did not cut VAT on diesel. They complain that they are losing their business to Haryana, reports Atul Mathur.

business Updated: Jun 22, 2008 00:01 IST
Atul Mathur

Petroleum dealers in the Capital have threatened to go on a protest if the Delhi government did not cut VAT on diesel.

Traders said they have spoken to the Chief Minister and Finance Minister and have got nothing but assurances. “We will wait for seven days and if nothing happens, the managing committee of our association will plan the future course of action,” said Anil Bijlani, general secretary, Delhi Petrol Dealers Association.

Dealers complained that they are losing their business to Haryana, which has recently cut VAT on diesel from 12.5 per cent to 8.8 per cent, thus making it cheaper by Rs 1.25 per litre in comparison to Delhi.

“In the past 10 days, our sales have gone down by 30 per cent. If VAT is not reduced in Delhi, we will lose 60 per cent our business to Haryana,” he said.

Delhi sells about 12 crore litre diesel everyday and dealers fear that it might drop to just half. Bijlani added that there is loss in business on petrol as well but it is not as big as on diesel.

In Delhi, diesel costs Rs 34.80 per litre, while it now costs Rs 33.60 in Haryana now. Before the petroleum prices were jacked up by the central government, diesel in Haryana was dearer by Rs 0.25.

“A truck driver would save on Rs 1,250 if he buys 1,000 litre of diesel from Haryana and it is indeed a big amount. If the difference in the rate of VAT continued, not only the Delhi’s business would shift to Haryana, inter-state trading will also start,” said Bijlani.

Petroleum dealers in Haryana also confirmed increase in their sales. “We used to sell 11,000 to 12,000 litre diesel earlier, while now we sell almost 20,000 litre diesel. The number of cars and trucks has increased at our filling station in past one week or so,” said an attendant at a fuel station in Faridabad.

Though consumers accept that the quality of diesel and petrol available in Delhi is better than what is available in neighbouring states, it is the price which plays a vital role.