The Indian government may issue state-run oil refining and retailing firms bonds worth 154 billion rupees ($3.36 billion) to compensate them for losses due to low fuel prices.

Indian Oil Corp, Hindustan Petroleum Corp Ltd and Bharat Petroleum Corp Ltd posted their first quarterly losses in April-June, the first quarter of the fiscal year as fuel prices were frozen between November and June.
India raised fuel prices by seven per cent in September, matching a similar increase in June, helping state firms improve their bottom lines, although refiners complained prices should have been raised further.
The refiners wanted a sharper increase in retail prices but the government, facing strong political pressure from its leftist allies, allowed only a moderate rise and promised to issue bonds to help oil companies withstand high crude prices.
“We have submitted the proposal to the Finance Ministry. It is for them and the RBI (central bank) to decide,” petroleum secretary SC Tripathi said.
Tripathi said the bonds were likely to be issued for three years with a zero interest rate.
The government has appointed a committee of top officials to suggest a new system of pricing, which would dilute the government’s tight control.