The oil ministry has argued that the additional amount garnered can be used to make good a part of the loss that fuel retailers incur on the sale of diesel at government-controlled rates. The retailers are expected to incur a loss of about Rs82,000 crore in 2011-12
New Delhi: Diesel car buyers may have to shell out more with the finance ministry considering the imposition of higher excise duty on such vehicles in the upcoming Budget likely to be unveiled sometime in March, reports PTI.
In order to discourage consumption of subsidised diesel by personal vehicle owners, the petroleum ministry had suggested the imposition of higher duty on the purchase of diesel cars to the finance ministry.
“We are working on the proposal to impose higher excise duty on diesel cars,” a senior finance ministry official said.
While the petroleum ministry has been asking for a hike in the excise duty on diesel cars, the heavy industries ministry is opposing the move.
The oil ministry has argued that the additional amount garnered can be used to make good a part of the loss that fuel retailers incur on the sale of diesel at government-controlled rates. The retailers are expected to incur a loss of about Rs82,000 crore in 2011-12.
The higher duty would also prevent ‘dieselisation’ of the economy, it has been reasoned.
The Kirit Parikh Committee on Energy had also suggested a one-time additional excise duty of Rs80,000 on diesel cars, arguing that it would offset the higher excise duty on petrol.
Petrol cars up to 4 metres long and with a 1,200-cc engine capacity and diesel cars up to 4 metres long with a 1,500-cc engine capacity attract 10% excise duty.
In addition, petrol cars longer than 4 metres and with an engine capacity above 1,200-cc and diesel cars more than 4 metres in length and with an engine capacity above 1,500-cc attract excise duty at the rate of 22%, plus Rs15,000.
The diesel price of Rs40 a litre in Delhi is Rs14.57 lower than its imported cost.
Diesel is the most consumed fuel in the country but is sold at a discount to its imported cost. The current diesel subsidy is Rs14.57 per litre and on an annualised basis this amounts to Rs82,000 crore out of the total fuel subsidy, estimated at Rs 136,936 crore in the current fiscal.
Subsidised diesel is the preferred fuel for the transport sector (both trucks and passenger buses) and is also used in irrigation pumps and other agriculture equipment.
Luxury cars and SUVs also run on diesel and so do power generators at malls and telecom towers.
It has long been argued that the rich should not get subsidised fuel. According to oil ministry estimates, 15% of diesel consumption is accounted for by personal cars and SUVs.
As per official figures, in the last 15 years—with the exception of 1996-97 and 2004-05—petrol growth has been generally more than diesel.
However, in April-November 2011, diesel growth stood at 7.4%, as against the petrol growth rate of 4.3%. Similarly, the growth rate of diesel in November 2011 was 16% against November 2010 as compared to a negative growth of -2.4% in petrol.
The draft Bill proposes to make it mandatory for microfinance institutions (MFIs) to be registered with the RBI and have minimum net-owned funds of Rs5 lakh
New Delhi: The government is likely to introduce a Bill that seeks to make it mandatory for all microfinance institutions to be registered with the Reserve Bank of India (RBI) in the Budget Session of Parliament, reports PTI.
The finance ministry has sent the draft Bill to the law ministry for approval and will subsequently seek the Cabinet’s nod, official sources said.
The ministry hopes to table the Bill in the upcoming Budget Session of Parliament, which is expected to commence in mid-March.
The draft Micro Financial Sector (Development and Regulation) Bill, 2011, circulated for public comments in July last year had proposed that the RBI will be regulator for the sector.
In an earlier Bill, it was proposed that the National Bank for Agriculture and Rural Development (NABARD) would be the regulator of the sector.
The government introduced the Micro Financial Sector Bill in the Lok Sabha in March 2007. However, the Bill lapsed when the term of the 14th Lok Sabha expired in 2009.
The latest draft Bill proposes to make it mandatory for microfinance institutions (MFIs) to be registered with the RBI and have minimum net-owned funds of Rs5 lakh.
In addition, a Microfinance Development Council will be set up to advise the government on formulation of policies, schemes and other measures required in the interest of orderly growth and development of the sector and micro-finance institutions with a view to promote financial inclusion.
The council will comprise members not below the rank of executive director from NABARD, National Housing Bank, the RBI and SIDBI. In addition, joint secretaries from the ministry of finance and the ministry of rural development will also be its members.
The draft Bill also proposes that any MFI which is not a company registered under the Companies Act, 1956, and which becomes a systemically important MFI shall convert its institution into a company registered under the Companies Act, 1956, with or without a licence, under Section 25 of the Act.
This should happen within six months from the date of the balance sheet that shows the MFI has become a systematically important MFI in terms of the rules prescribed by the central government, the draft Bill said.
The RBI may pass an order directing a MFI to cease and desist from carrying out microfinance activities if it is found acting in manner prejudicial to the interest of its clients or depositors.
The RBI will cancel the certificate of registration granted to a MFI if it fails to comply with the directives or conditions, the draft Bill states.
Repro India increased 11%, GMDC rose 9%, whereas Gujarat State Fertilizers fell 5%