ONCE the parity in the prices of kerosene and high speed diesel oil (HSDO) ceased in 1978-79 and HSDO prices soared to nearly 3 times that of kerosene in 1992-93, there has been a sharp increase in the demand for kerosene in the blackmarket. While the household energy consumption grew at a rate of an estimated 3 to 4 per cent per annum, the sale of kerosene inordinately grew at 6.5 per cent, signalling that a good bit was going somewhere else.

Significantly, the estimated consumption of HSDO is less than its sale. The shortfall between sales and estimated consumption of kerosene shot up to 2.6 million tonnes in 1985-86 from 72,000 tonnes in 1979-80. This gap could be explained by the diversion of kerosene meant for the domestic sector to the transport sector.