Guwahati News Desk: The rising petrol and diesel prices across the nation has created a panic situation as most of the major cities petrol prices has crossed over Rs 100 in recent days.
The present government under the leadership of Prime Minister Narendra Modi facing a hard time as petrol and diesel prices are seen rising.
The reason for the rising petrol and diesel prices is back in early 2000 the present government and the next government have a bill worth Rs 1.3 lakh crore which the government has to pay towards the redemptions of outstanding oil bonds.
In the last financial year 2020-2021, the central and State government has collected taxes up to 60 per cent on fuel prices as the central government mopped up Rs 3.72 lakh crore in excise duty on crude oil and petroleum products. On the other hand, the State government has collected Rs 2.03 lakh crore in sales tax and VAT on petrol and diesel.
What’s Oil Bond?
Oil Bonds were issued in lieu of cash subsidy during the government rule under former Prime Minister of India Atal Bihari Vajpayee and Dr Manmohan Singh to Oil Marketing Companies (OMCs). These sovereign oil bonds were issued in favour of oil companies like Indian Oil Corporation, HPCL and BPCL were transferable which allows the above companies to raise immediate cash at the time. Earlier, under the government of Dr Manmohan Singh and Atal Bihari Vajpayee, the Oil Marketing Companies were selling petrol and diesel at very lower prices than the actual value in the international market prices to keep it affordable for the consumers. Being the issuer, the government would bear the interest payments and redemption at maturity.
Earlier on June 2021, the National President of the Information Technology cell of the Bharatiya Janata Party (BJP) Amit Malviya has tweeted regarding the increasing price of petrol and diesel is the mismanagement of the UPA’s government, “We are paying for the oil bonds that will come up for redemption starting FY2021 till (2026), which were issued by UPA to oil companies for not increasing retail prices then! Bad economics, bad politics.”
According to the Budget documents, the Bond Burden
Oil Bonds | Due to mature | in crore
1) 18.13 per cent Oil Mkt Comp GOI SB 2021 | October 16, 2021 | Rs 5,000 crore
2) 7.75 per cent OMC GOI Spl Bonds 2021 | Nobember 28, 2021 | Rs 5,000 crore
3) 8.20 per cent Oil Mkn GOI Spl Bonds 2023 | November 10, 2023 | Rs 22,000 crore
4) 8.01 per cent Oil Mkt Cos GOI SB 2023 | December 15, 2023 | Rs 4,150 crore
5) 8.20 per cent Oil Mktg Cos GOI SB 2024| February 12, 2024 | Rs 5,000 crore
6) 8.20 per cent Mktg Cos GOI SB 2024 | September 15, 2024 | Rs 10,306.33 crore
7) 6.35 per cent Oil MktnCo GOI SB 2024 | December 23, 2024 | Rs 22,000 crore
8) 7.95 per cent Oil Mktg Cos GOI SB 2025 | January 18, 2025 | Rs 11,256.92 crore
9) 8.40 per cent Oil Mktn Co GOI Spl B 2025 | March 28, 2025 | Rs 9,296.92 crore
10) 6.90 per cent Mktg Cos GOI SB 2026 | February 04, 2026 | Rs 21,942 crore
11) 8.00 per cent Mkt Cos GOI SB 2026 | March 23, 2026 | Rs 10,000 crore
12) 8.40 per cent Mktg Cos GOI SB 2026 | March 29, 2026 | Rs 4,971.00
The total Oil Bond due is Rs 1,30,923.20 crore. Total Interest on Oil Bond:
1) 2019-2020 | Rs 9,989.96 crore
2) 2020-21 (BE) | Rs 9,989.96 crore
3) 2020-21 (RE) | Rs 9,989.96 crore
4) 2021-22 (BE) | Rs 9,989.96 crore
Photo | Representative Image