Disclosing this during his speech on `Energy Pricing and its effect on national productivity’ here on Wednesday, Confederation of Indian Industries Chief Advisor and Chief Coordinator for Energy and Environment Mr V Raghuraman said that unless India achieved one-market and one rate of tax for petroleum produces, the country will have to invest substantially on the future discovery of energy resources.
Giving the example of petroleum prices across the country, Mr Raghuraman noted that the Bangalorean paid 190 US dollar per barrel of petrol, while Delhi paid 180 US dollar per barrel. However, the international price was still 100 USD per barrel, he pointed out.
Refineries benefited
``In 2002, the government had collected Rs 17,000 crore through petroleum duty, while it has crossed over 100,000 crore this year. However, only the refineries are benefited by this duty, while petroleum product marketing companies are bleeding. The government has extended import parity to refinery companies, where the tax will fluctuate with international market price on petroleum products,’’  he pointed out. In the bargain, the private refineries were making money at the cost of inefficiency of public sector undertaking.
Most of the private refineries were availing the benefits and exporting the petroleum produces at much higher price. Last year, petroleum product export outdid gem and jewellry export, wherein more than 20 million tones of petroleum produces were exported, he noted.
World Bank model
Taking a dig at the Government policy on power, Mr Raghuraman said that the government assured 16 per cent assured returns to private power producers to woo investments.
``This is a typical world bank model, which failed the world over and the government is spending for its own inefficiency. Instead, the government should allow the market to determine the cost of power,’’ he noted.
The pricing should be based on efficiency of utility and not on entire quantity. Even if the government want to extend subsidy, it should be given to the consumer and should not subsidise the entire product, he said.
Stating that the petroleum resources were located in geo-politically troubled areas like Iran, Iraq and Sudan, Mr Raghuraman said that India should take lessons from countries like Indonesia, Malaysia and China -- which have adopted better ways of pricing energy. Or else, the country will face sever shortage of energy in near future, he added.