Bathinda refinery

Chandigarh : The issue of grant of concessions to the Bathinda refinery being established by HPCL-Mittal Energy Limited (HMEL) is set to get more complex with Punjab Industries Minister and BJP legislature party leader Manoranjan Kalia today saying he would ask the Chief Minister to consider further concessions to the refinery project keeping the state’s financial position in mind. The issue of proposed concessions to the Rs 19,000 crore Bathinda refinery, which is nearing completion, has already triggered protest by both the Congress as well as former Finance Minister Manpreet Singh Badal who has rebelled against the SAD. The Industries Minister, while talking to TNS, claimed the refinery promoters had the right to demand concessions and that the state was willing to have a fresh look at the case. He, however, said the state had limited resources and that its fiscal position did not permit much largesse.

The minister said the state was already giving a Rs 250 crore per annum interest-free loan to the refinery for a period of five years amounting to a total concession of Rs 1,250 crore. He said HMEL had agreed to this earlier but was now demanding more incentives stating the global slowdown in the economy as well as concessions being given by other states to refinery projects would make the Bathinda refinery unviable.  He said the company had also pointed out that a Rs 1,300 crore ancillary hub would have a multiplying effect on the state’s economy and give a boost to its industrial development. Stating that the promoters had their points, he said it was also a fact that no state government except for Punjab had given any cash loans to refinery projects in their territories. “They have only deferred VAT collections”, he added.  Kalia, however, made it clear that HMEL was only asking for an interest-free loan of Rs 400 crore per year for 15 years. He said this amounted to a Rs 6,000 crore concession with the promoters committing themselves to repaying the loan from the 16th year onwards. This proposal also has the support of the Prime Minister’s Office (PMO) and is under consideration of the state government. The BJP leader said there was no truth in Pradesh Congress President Amarinder Singh’s statement that the government was considering a Rs 20,000 crore concession to the refinery by processing a proposal for a waiver on VAT for 15 years. He said there was no proposal to waive VAT for the project.