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New oil minister vows to be fast in decisions, friendly to investors

New oil minister vows to be fast in decisions, friendly to investors
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Stepping into a ministry that had in recent times become notoriously indecisive, the new oil minister M Veerappa Moily on Monday promised quick decisions and creating an environment conducive for investment to flow in.

Moily, 72, who replaced S Jaipal Reddy, said his priority would be to intensify domestic oil and gas exploration to reduce import dependence that had played havoc with inflation.

'Emphasis will be on quick decision making and innovation. Decisions should not be delayed. Delaying decisions will cost the nation. We do not want any delay in decisions,' he said after taking charge.

Lauding his predecessor, under whom the ministry was accused of being indecisive and almost halting oil and gas exploration, Moily said Reddy had done 'wonderful job, setting highest standard of probity in administration.'

'Many a times it happens (that) you avoid taking decisions. That is not a solution. Avoiding or delaying decision is not a solution. And this is where we need to very seriously work on,' said Moily, who was previously Minister for Power and Corporate Affairs. Decisions, he said, would be taken keeping the national interest in mind and not to be 'benefit one or two individuals or companies.'

Laying out priorities, Moily said a conducive environment would be created for domestic and foreign companies to explore for oil and gas so as India's import dependence, which is at an alarming level of 80 per cent, is reduced.

Also, the vexed issue of losses state retailers suffer on selling fuel below cost will be addressed by bringing in efficiencies and not by cutting subsidies. 'Investment will have to be attracted through conducive policy environment...

We need to create that kind of confidence with the investors that this is the country that (should be their) investment destination,’ Moily said.  Moily said he would soon bring out a road map for bringing consumption up to 6 barrels per person per year. ‘Average worldwide oil consumption is 14 barrels per person per year while that in developing countries it is three barrels per person per year. In India the picture is not so happy with a consumption of 1.2 barrels per person per year.

Listing out priorities, he said policy has to be made conducive for foreign investment and delays in decision making avoid it.    


TO ASK FM FOR RS 1 LAKH CR TOWARDS FUEL SUBSIDIES

The oil ministry will seek over Rs 1 lakh crore from the finance ministry this fiscal towards fuel subsidy, new petroleum minister M Veerappa Moily said. State-owned fuel retailers are likely to end the fiscal with a revenue loss of over Rs 1,63,000 crore on sale of diesel, domestic cooking gas (LPG) and kerosene at government- controlled rates that are way lower than cost, he said soon after taking over as the new oil minister.

'Of this, about Rs 60,000 crore will come from upstream companies Oil and Natural Gas Corp (ONGC), Oil India Ltd and GAIL India. We will ask the finance ministry to compensate the rest by way of cash subsidy,' he said.

Oil PSUs, he said, cannot sustain high level of under- recoveries or revenue losses and ways have to be found to drastically bring down these.'How long can you run these companies on loss. How long can you go with these kind of under-recoveries. It is criminal. We need to prepare roadmap to see under-recoveries drastically comes down,' he said. 'I am not saying subsidy should be cut but inefficiencies have to be removed from the sector.'

State retailers currently lose Rs 9.82 per litre on diesel, Rs 33.93 a litre on kerosene and Rs 468.50 per 14.2-kg subsidised LPG cylinder.    
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