Cabinet approves more oil royalty for states

Vol 6, PW 24 (12 Feb 03) News in Brief
     

Good news for oil producing states Assam, Gujarat, Andhra Pradesh and Nagaland.

On 4th February the cabinet approved the Mauskar Royalty Report and has agreed to pay Rs436cr ($90m) backdated royalty from 1st April 1998 to 31st March 2002 by the end of the financial year on 31st March. Royalty for this year is about Rs500cr ($102m) thanks to high global crude prices, but states won't get this money before June as the finance ministry is busy with the annual budget due on 28th February.

Many see the cabinet decision as a victory against the finance ministry's refusal to release money to the states. Submitted in November 2001, the Mauskar report reconciles state demands for more royalty with oil company demands for more money to invest in E&P.

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