OUTSTANDING OIL ROYALTY
BY OUR STAFF REPORTER
Guwahati, Feb 21: The Centre has cleared the decks to release the entire oil royalty dues of Assam, outstanding to the tune of Rs 6,320 crore, in phased manner over three fiscals including the current one. An MoU to this effect was signed between Assam Chief Secretary and the Petroleum Secretary in New Delhi on Monday, paving the way for oil PSUs ONGC and OIL to release the dues to Assam.
Accordingly, Assam will receive Rs 948 crore in the current fiscal, Rs 2,844 crore in 2017-18 and Rs 2,528 crore in 2018-19. Petroleum Minister Dharmendra Pradhan is slated to visit the State before March 31 this year to hand over the cheque of the first instalment to the State government.
As per the Ministry of Petroleum and tural Gas, of the total amount Rs 6,320 accrued as oil royalty to Assam government from 2008 to 2014, ONGC owes Rs 1,350 crore while OIL owes Rs 4,970 crore.
It may be mentioned that the Assam government has already received Rs 1,450 crore oil royalty (at pre-discount prices outstanding since February 1, 2014) in August, 2016.
Welcoming the Centre’s decision, Chief Minister Sarbanda Sonowal said that the decision to release oil royalty which Assam has been long demanding would bring back the confidence of the people and revive the State’s growth cycle. “The strong leadership of our Prime Minister and his keen interest to bolster development of Assam and the Northeast has ebled the State to get its dues (oil royalty), which has long been ignored by the previous Congress-led UPA government and its cohorts,” said Sonowal in a statement from New Delhi.
Addressing a press meet in Guwahati on Tuesday, State Fince Minister Himanta Biswa Sarma pointed out that the amount of Rs 6,320 crore is in addition to Rs 1,450 crore already released by the Central government.
“It is an achievement on our part that we have been able to receive such a huge amount in less than nine months of coming to power in Assam. This is going to improve the fincial condition of Assam to a great extent,” Sarma said, expressing the hope that next year’s State budget would be at least Rs 1,000-crore in surplus.
Earlier, ONGC and OIL used to pay royalty to the Centre and governments of oil producing states under Oilfields (regulation and Development) Act, 1948, PNG Rules 1949 and subsequent notifications. However, in 2003, the Central government directed the Oil PSUs to sell oil at discounted rates to oil marketers. However, it was provided that this change in rules will not affect royalty payable to state governments.
But in 2008, the Central government withdrew this provision, so that state governments started receiving oil royalty calculated after discount, thereby substantially cutting down their oil revenues.
“The Manmohan Singh government at the Centre had taken this step to put the then Gujarat chief minister into a tight corner, but the move ended up harming the interests of Assam as well. Despite Congress governments both at the Centre and in Assam, and in spite of the Prime Minister himself then representing Assam in parliament, this State failed to get justice,” said Sarma.