Investigation Findings: Examination of the expenses allocated for UPA-era oil bonds by the Modi Administration
In the world of fiscal policy, oil bonds have been a significant aspect of India's financial landscape, particularly over the last two decades. These government securities, often long-dated securities of 10-20 years, were issued by various governments, including the UPA and the previous NDA government under Vajpayee, to compensate Oil Marketing Companies (OMCs) instead of paying subsidies on petrol, diesel, and other oil products.
The payment on oil bonds represents less than 6% of the total excise duty collected on petrol and diesel. The receipt budgets of 2014-15 and 2018-19, specifically annexures 6E and 2E respectively, reveal the information of pending oil bonds and the amount of interest to be paid on these bonds.
The total value of pending oil bonds by the end of 2013-14 was Rs 1,34,423 crore. Interestingly, the data suggests that various governments (both UPA and NDA) have been paying interest on oil bonds for the last 20 years. The UPA-2 government, for instance, paid a total of Rs 53,163 crore in interest for oil bonds in the 5-year period between 2009-10 and 2013-14. The Modi government, on the other hand, paid a total of Rs 40,225 crore in interest for oil bonds between 2014-15 and 2017-18.
However, it's important to note that there are no specific figures available about how much the Modi government or previous Indian governments have paid for oil subsidies or oil-related financial support. The search results do not include information on payments related to oil bonding by Indian governments.
The Petroleum Planning & Analysis Cell (PPAC) under the Ministry of Petroleum has confirmed that the current government has only repaid oil bonds worth Rs 3,500 crore. The only set of oil bonds due for maturity during the 2014-19 period were the two sets of bonds which matured in 2015, totaling Rs 3500 crore.
Interestingly, the interest payments for the last 4 years indicate that there was no change in the outstanding amount, hence no repayments in the last four years except in 2015. This suggests that the pending liabilities, which stood at Rs 1,34,423 crore when the Modi government took over, have only slightly decreased to Rs 1,30,923 crore by 2018-19.
The interest liability increased substantially during the UPA-1 because of the issue of multiple oil bonds. This trend continued under the UPA-2 government, but it's important to note that the data presented here is a broad overview and more detailed analysis might reveal different insights.
In conclusion, while oil bonds have been a crucial part of India's fiscal policy, the payments and liabilities associated with them have been significant and have continued over the last two decades. The data suggests that the Modi government has paid a substantial amount in interest for oil bonds but has yet to make significant repayments. The exact figures for oil subsidies and other oil-related financial support paid by the government remain unclear.
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