Delay in the disbursement of the assured interest-free loan by Punjab government to theHindustan Petroleum Corporation-Mittal Energy (HMEL)'sBathinda refinery project may affect the import of crude oil by the refinery.
The state governmentassured to pay Rs 250 crore to the refinery each year for five years for the project, which has an output capacity of 1.8 lakh barrels a day.
The HMEL is then stipulated to return the amount in the same manner starting a year after the disbursement of the last installment.
However, the state government has not paid even the first Rs 250-crore installment. The company has also taken loan of Rs 10,500 crore from various financial institutions, and the default on payment by the state could make it harder for the company to pay interest on these loans. The refinery was inaugurated on April 28.
There have been several verbal and written communications made to the Punjab government by the HMEL, but to little avail, reports suggest.