Government indifferent to NOC losses

Despite continued losses of over Rs 830 million per month, the government has not taken any initiative to rescue the state-owned Nepal Oil Corporation (NOC) from going bankrupt.

Petrol shortage: Motorbikes queuing at a petrol pump to tank-up. There is a shortage of petrol in the Valley since a few days, though the NOC denies short supply of fuel.

According to NOC sources, the government has not given attention to the request of the NOC to either raise the price of POL products or provide financial assistance to pay off the debts it owes.

When contacted by Nepalnews, Minister for Commerce, Industries and Supplies Hridayesh Tripathi and secretary of the ministry Bharat Bahadur Thapa avoided any responses to the inquiry regarding any decision that government is going to take to manage the losses of the NOC.

An official of the ministry said ministers and secretaries have intensified their consultation after the Indian Oil Corporation (IOC) officers in their recent visit to Nepal pressurized the NOC and the government to repay the debt.

Minister Tripathi had earlier said that government would not increase the price of the POL products despite unbearable losses of the NOC.

IOC officers had told the finance and supply ministers that it would not be able to continue the supply of the POL products if the dues were not paid on time. To the request of the NOC to scrap the interest of the debt, the IOC had said that alternatives will floated only after NOC clears up the principle amount, NOC deputy general manager Umesh Dahal said.

Spokesperson of the NOC Mukunda Dhungel quoted the IOC officials as saying that NOC should repay the debt at the earliest possible if it wants to make further purchases.

The shortage of POL products in the market has been observed since the return of the IOC officials on Saturday after the official meeting with NOC officials and finance and supply ministers. Though the NOC officials claim that supply of fuel in the market has been normalized, consumers are facing a difficult time filling fuel in their vehicles since Saturday with most of the Valley petrol pumps closed with ‘no fuel’ signs. Petroleum Dealers' Association has accused the NOC of not supplying enough petroleum products in the market.

Dhungel also admitted that the POL reserve has decreased due to surge in the demand in recent days. "We have only 90 percent stock of our capacity," he said. NOC has the capacity to store some 1.5 million liters.

According to Dhungel, the debt with the IOC has reached over Rs 8.7 billion. The NOC also owes another Rs 3.5 billion to private banks in the country.

Officials fear the state corporation would go bankrupt if government does not take immediate steps to rescue it. nepalnews.com ia Aug 15 06

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