Nepal to pay Indian Oil Corporation due issuing bonds

Kathmandu, Dec 19 (UNI) Nepal Supplies Minister Shyam Sundar Gupta said Nepal government was preparing to bail out Nepal Oil Corporation (NOC) that owes Rs 2.44 billion to Indian Oil Corporation.

''The government will issue oil bonds worth Rs 3 billion to raise money from the public to pay the IOC, fully de-regulate liquified petroleum gas to ensure better supply and also borrow Rs 500 million from Nepal Bank Ltd to improve the Corporation's cash flow,'' the Minister was quoted as sayng.

He said the government would gradually open the petroleum product market to the private sector. An ordinance to this effect has already been tabled in the parliament, he said.

These measures were expected to help normalise the supply of petroleum products in the country, Himalayan Times quoted.

The cooking gas market would be fully de-regulated by the end of this week, Mr Gupta said.

He said Finance Ministry officials would table a proposal in the cabinet tomorrow to allow the Ministry to issue oil bonds worth Rs 3 billion to clear the NOC's debts and also free the Corporation from the nine per cent interest that it pays for 'payment defaults'.

IOC is the main source of petroleum supplier to Nepal.

UNI