There could not be a better festival gift from Prime Minister Manmohan Singh to the people of Nepal. As a goodwill gesture, New Delhi has agreed to allow a credit of upto Rs 150 crore for uninterrupted supply of petroleum products by the state-owned Indian Oil Corporation (IOC) to Kathmandu during the festival season.
Informing petroleum minister Murli Deora of the decision, the external affairs minister, Pranab Mukherjee said, ?The Prime Minister has agreed to allow a credit of upto Rs 150 crore to the Nepal Oil Corporation (NOC) for the next three months. In view of this decision, I would request you to advise Indian Oil to supply petroleum products on credit to the extent of Rs 150 crore over and above the existing arrears.?
NOC imports all its petro products from India and had even defaulted on payments for its POL supplies from India. Its dues had mounted to Rs 400 crore in March last year. Under an agreement between IOC and NOC, the outstanding dues are being liquidated at the rate of Rs 15 to 20 crores per month which has brought down the dues of NOC significantly from Rs 400 crores to Rs 44.36 crore. After including the interest payable, the outstanding dues are Rs 95.64 crore.