IndianOil may get Rs 195 cr from Nepal soon
Kolkata   14-Jan-2008
IndianOil, the sole supplier of hydrocarbon to Nepal Oil Corporation (NOG), is likely to receive Rs 195 crore from Nepal soon as a pan payment against its receivables of over Rs 300 crore from NOC. In a desperate attempt to ease out ongoing oil shortage, the Nepal government has committed to fund the amount to NOC, the state-owned petroleum monopoly. "The finance ministry has already made arrangements to release the fund," said sources in the Nepal government. The funding would be organised from different sources by the finance ministry, which would be passed on to NOC in three installments. The first instalment is likely to be released by next Monday, Later, the ministry will garner the amount by issuing oil bonds to repay the sources. The Nepal government cabinet has already approved the oil bonds. In addition, Nepal may also go for a price adjustment for a few petroleum products with relief schemes for target groups. Though in terms of volume, Rs 300 crore is not a huge sum for IndianOil, but a tug of war over the overdue payments between NOC and IndianOil has pushed Nepal's oil market into crisis. Earlier, being backed by the government's decision to guarantee fresh loans, the financially hit NOC decided to take an NPR 400 million loan from Citizen Investment Trust and NPR 800 million from the employees’ provident fund. In addition, the government itself was to give NPR 500 million. But, even that initiative could not shore up Nepal's hydrocarbon scenario.