The Telegraph
Since 1st March, 1999
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Oil at half century

New Delhi, June 5: Petrol price has crossed Rs 50 a litre for the first time in the country.

The government today stepped up the price of petrol by over Rs 4 per litre, ignoring protests from the Left allies. A litre of diesel will cost over Rs 2 more.

After factoring in taxes, the petrol price in Calcutta will touch Rs 51.07, an increase of Rs 4.17. Diesel will cost Rs 34.96 a litre in the city.

Cooking gas and kerosene have been spared from the hike.

The Left greeted the price increase with customary threats to launch a “nationwide agitation in the form of demonstrations and rallies”. Such protests will be held in Bengal tomorrow.

The Congress demanded a price review, but petroleum minister Murli Deora said “there will be no rollback”.

Sources said railway minister Lalu Prasad was the lone voice to oppose the increase at a cabinet meeting today. Railway expenditure will go up because of the diesel price hike.

The new rates will fetch public sector oil companies additional income of Rs 9,300 crore during the current financial year.

The government may also issue bonds to the oil companies, cut customs duty and change the pricing formula to help the oil companies reduce anticipated losses from Rs 73,500 crore to less than Rs 3,000 crore.

A trial scheme to confine kerosene sold through the public distribution system to families living below the poverty line will be launched in 15 days.

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