Indian ministry rejects oil bonds plan

NEW DELHI, May 14 (UPI) -- India's Finance Ministry has rejected a plan to issue oil bonds to help state-run oil marketing companies reeling from massive losses.

The Petroleum and Natural Gas Ministry asked the Finance Ministry to cover 57.1 percent of the losses, but the proposal was rejected.

"We asked for issuing 57.1 percent oil bonds," Petroleum and Natural Gas Minister Murli Deora said Tuesday after a meeting with Finance Minister Palaniappan Chidambaram. "The Finance Ministry does not agree with our contention and has asked us to rework our figures."

The comments were reported by The Hindu newspaper.

OMCs sell fuels such as petrol, diesel, kerosene and liquefied petroleum gas far below market prices and have lost more than $6 billion by selling the subsidized fuel to consumers.

The firms petitioned the Petroleum and Natural Gas Ministry on the issue in the face of high global oil prices.