KATHMANDU, June 9 : The government has decided to dole out Rs 1.40 billion to the Nepal Oil Corporation (NOC) and also ordered two public sector financial institutions to instantly provide another Rs 1.60 billion so that the corporation could clear its dues with its Indian counterpart and ensure resumption of normal fuel supply.
Indian Oil Corporation (IOC) has cut supplies of petroleum products to Nepal by more than half since a week ago, after NOC failed to submit a clear plan on how it would settle its dues that stand at Rs 3.20 billion.
With the short supply affecting the distribution of the fuel in the market, queues of vehicles have started to spring up at refilling stations, subjecting consumers to yet another spate of trouble.
In order to address the scarcity, the corporation had pressed the government to either allow it to hike prices in line with the import rates or provide it with requisite funds to settle IOC´s dues. Instead of adjusting prices, the government chose the easy way out yet again, and decided to instantly arrange Rs 3 billion to the corporation.
“Under the decision taken on Friday, Ministry of Finance has agreed to release Rs 1.40 billion to the NOC within the next couple of days,” said Finance Secretary.
Likewise, Citizens Investment Trust (CIT) and Employees Provident Fund (EPF) have also been pressed to instantly release Rs 1 billion and Rs 600 million respectively to the corporation.
Acting on the instruction, CIT, which had recently completed formalities to lend out Rs 1 billion to the corporation as per the recent government´s decision, released Rs 700 million to the NOC on Friday itself. “It has also committed to provide remaining Rs 300 million within the next few days,” said acting Managing Director of NOC Suresh Kumar Agrawal.
Likewise, EPF too has said it would issue its portion of fresh loans to NOC within the next couple of days.
“The Friday´s decision has arranged us much needed Rs 3 billion. We will use it to settle the IOC´s dues,” said Agrawal. Talking to the press, he said the NOC has already informed the IOC about the fresh arrangement of fund.
“The message of earliest payment of dues has already been conveyed. IOC has agreed to resume normal supply of fuel as well,” said Agrawal, adding that the corporation would step up the distribution of fuel in the market from Sunday itself.
Despite Agrawal´s commitment, senior officials said consumers might find supply turning normal only after Wednesday.