The Bhutanese Leading the way.
For around four months the Department of Trade (DoT) had been trying everything officially and unofficially to get a break up of the fuel prices charged to Bhutan by fuel Oil companies in India.
This is especially after the much lower base rate (minus taxes) charged to Indian dealers, and also the same fuel being sold by the same companies to Nepal at a cheaper rate.
That effort did not yield results and Bhutan’s Embassy in Delhi also had to start making enquiries in Delhi on the price difference especially with Nepal.
As of April 2022 Nepal buys Diesel cheaper by Nu 12.23 per liter than Bhutan and petrol cheaper by Nu 11.48 per liter.
However, when the break up was finally sent from Indian Oil Corporation (IOC) to Bhutan, it does not explain why Bhutan is paying much more than Indian pumps (minus tax), and also why Bhutan is paying more than Nepal.
The IOC says that the basic price at the Siliguri Depot is INR 77.76 per liter for petrol and INR 85 for diesel.
After adding Railway freight, sidings and shunting charges it becomes 78.06 for petrol and 85.33 per liter for diesel.
A transportation charge of Nu 1.68 for petrol and Nu 1.65 for diesel is added while delivering this to Bhutan and the price charged to Bhutan at the border is Nu 79.74 for petrol and Nu 86.98 for diesel.
However, in contradiction to the above rates the IOC’s own website shows that the base price of petrol with freight in Delhi is INR 56.52. After this central and state taxes and dealer’s commission pushes the price to 105 meaning that around 50 percent of the fuel price in India is central government and state government taxes which Bhutan does not have to pay.
Similarly, the base price with freight for diesel is INR 58.16.
As of 27 January 2022 petrol in West Bengal had a base price of INR 48.23 per liter, central government tax or excise was INR 27.90, state government tax or VAT was INR 19.27, dealer commission was INR 3.47 and others like commission charged to pump owns etc was INR 5.78 taking the total price to INR 104.65 per liter.
The current price of petrol in Kolkata, West Bengal is INR 115.12 which is because of the increase in the base rate as show above in Delhi.
So it does not make sense that when more than 50 percent of the fuel prices in West Bengal is linked to central and state government taxes why IOC is charging a higher rate for Bhutan.
What is also not explained is that why the same oil depots in Siliguri sell the same oil to Nepal at a much cheaper rate. Earlier, when this paper contacted the spokesperson of the Nepal Oil Corporation (NOC) he said that eastern Nepal buys its fuel from Siliguri.
With the DoT and Bhutan still clueless about why it is paying more fuel than Nepal or why it being charged the current price, the only alternative left for Bhutan will be to take it up at the bilateral level between the two governments.
