Hedging: Rs 600 M STC Should Pay Till December 2013

Rs 600 million. This is the remaining amount that STC has yet to pay, upon exercise of hedging done by the management of this company in 2008. The deal had caused a loss of Rs 4.7 billion. This slate of Rs 600 million, we learn, could be cleared by December 2013.

Note that this loss could have been blotted from April 2012. However, the Petroleum Pricing Committee had, in March 2011, decided to reduce the additional load on each liter of fuel sold at the pump to fund the repayment of these debts. This charge was Rs 3 per liter had been reduced to Rs 1 on diesel and gasoline 1.25 Rs, 29 March 2011.This reduction was announced by the finance minister then, Pravind Jugnauth, in response to a Private Notice Question (PNQ) focused on the high cost of living.

This case raised and still raises controversy. In 2011, a document issued by the STC indicated that this is the Trade Minister at the time, Rajesh Jeetah, who gave his "verbal agreement" to exercise hedging.

Moreover, the current Minister of Commerce, Cader Sayed-Hossen, announced Tuesday in Parliament, it does not establish a commission of inquiry into the transactions of the STC. But he had, in December 2011, suggested that it was considering doing so in light of an unfavorable audit of the firm Insight Forensics on the activities of the state company.

According to him, the lawyer Coomara Payendee, he has committed to address the findings of Insight Forensics, found that this report is not based on hard evidence.