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Would the Government allow oil cos to fix petrol prices?  

Govt may allow oil cos to fix petrol prices ________________________________________
The Empowered Group of Ministers, headed by the Finance Minister, Mr. Pranab Mukherjee, is scheduled to meet on Monday.
New Delhi, June 6…With the softening of international crude oil and product prices, the time is right and the stage is set. But will the Government take the plunge and give oil companies a free hand in deciding the retail prices of auto fuels? The Empowered Group of Ministers (EGoM) headed by the Finance Minister, Mr Pranab Mukherjee, is scheduled to meet on June 7.It is expected to take a decision on petroleum products pricing. The other members are the Petroleum and Natural Gas Minister, Mr. Murli Deora; the Home Minister, Mr. P. Chidambaram; the Railway Minister , Ms Mamata Banerjee; the Chemicals and Fertilizer Minister , Mr. M.K. Alagiri; the Road and Highways Minister, Mr. Kamal Nath; and the Planning Commission Deputy Chairman, Mr Montek Singh Ahluwalia.
Rs 3 hike likely ::::The public sector oil marketing companies (OMCs) sell petroleum products below the market price, and in order to ensure that they recover at least the cost, a minimum hike of Rs 3 a litre on both petrol and dieselis required. The selling at below-cost has also led to private players such as Reliance Industries Ltd and Essar crying foul as the business had become uncompetitive.The buzz is that petrol prices would be set free while a more conservative approach on diesel will be adopted by proposing a phased hike .The Government is expected to reserve the right to intervene when international prices go up sharply. It also wants to impress upon the State Governments that they should not levy sales tax on any incremental retail price increase. Whether the EGoM will also take a call on LPG retail prices is not certain.
Kirit Parikh report::::The panel is expected to consider the Kirit Parikh Committee report that had suggested total deregulation of petrol and diesel prices and increase in kerosene and cooking gas prices proportionate to the rise in household incomes. Currently, the Sales Tax/VAT on diesel ranges from a low of 9.24 per cent in Haryana and to as much as 26 per cent in the Mumbai-Thane belt of Maharashtra. For petrol, the corresponding tax rate is the lowest at 18 per cent in Orissa and goes as high as 33.62 per cent in Punjab. The presence of the two key allies - Trinamool and the DMK – in the EGoM, makes it easier for the Government to take this crucial decision.
…Richa Mishra…from the pages of HINDU BUSINESS LINE newspaper.

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