ANANTAPUR: Abnormal difference in diesel prices between AP and Karnataka and in the Puducherry enclave of Yanam (located within AP) is jolting fuel outlets in border areas as hundreds of outlets in AP are incurring huge losses. Many of them have closed shop following poor business due to a difference of Rs 6 on a litre of diesel. Meanwhile, the vast difference in fuel price was directly benefiting mostly construction companies and other engineering sectors involved in government contract works.
This peculiar situation has been prevalent in the state for the past several years because of the difference of Value Added Taxes compared to neighbouring states.
Diesel price was Rs 97.29 per litre in AP while Rs 91.10 in Yanam of Puducherry and Rs 92.97 in Karnataka on Monday. The fuel outlets in border areas of AP were unable to compete with Karnataka outlets while transporters and construction companies prefer to purchase from Karnataka outlets in Rayalaseema region and Yanam outlets for ongoing projects in other parts of the state. The companies reportedly quote tenders about purchase of fuel from AP outlets but procure unofficially from other states and stand to benefit by more than 12 per cent.
Prasad, an analyst, observed that about 35 per cent of the budget should be spent on fuel in various forms, digging machinery, construction and transportation.
An outlet dealer from the borders of Madakasira area lamented that the business was not even to the level of petty shops in rural areas.
"We need to pay at least Rs 15000 towards salaries of workers", he said.
Presently, Polavaram, Handri Neeva Sujala Shravanthi, TB canals and road works are being executed in the state. An irrigation work against an estimated cost of Rs 1,500 crore entails Rs 600 crore on diesel, a fuel outlet dealer revealed. Normally, a machine requires minimum 20-30 litres of fuel per hour during digging of sluice and other works.
Even as associations have represented to the state government to review VAT and make the price like it is in Karnataka and Pondicherry, no action has been taken so far in this regard.