| Indian Oil Corporation (IOC) wants to sell its 9.6 per cent equity in Oil and Natural Gas Corporation and 4.83 per cent in GAIL India. |
| Officials told Business Standard that the ministry had sent a status note on petroleum pricing to the Cabinet with an indicative price difference between the retail and import parity price. Officials said the issue was yet to be referred to the Cabinet Secretariat. Selling cross-holdings require Cabinet approval. |
| "We are waiting for a Cabinet approval for the price increase before the cross-holding proposal is sent. There is a likelihood of the proposed price hike meeting resistance on the ground that IOC has earned money from the sale of cross-holdings though the fact is that money is required by these companies to meet capital expenditure," said the official. |
| The Cabinet is not likely to take up the petroleum price issue even next week and will wait for the Parliament session to be over, said officials. |
| Petroleum Minister Mani Shankar Aiyar, who was in Bathinda yesterday, said oil companies would have to bear the largest share of under-recoveries from the sale of petroleum products below the import parity price, while consumers would be protected to the extent possible though they might also have to share the burden. |
| IOC will earn about Rs 14,000 crore at current market value from the sale but the other three marketing companies, Bharat Petroleum, Hindustan Petroleum and IBP Ltd, have no such recourse. The four companies suffered a collective loss of Rs 1227 crore during the quarter ending June 30, 2005. |
| The increase in the prices of petrol and diesel does not require Cabinet approval since oil companies are free to set prices following the dismantling of the administered price mechanism from April 1, 2002. |
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