For the Indian government the rising crude oil prices may be a worry, but it may well turn out to be an opportunity for Reliance Industries which announced the closure of 1,432 retail pumps two months back. Because of the rising price of crude oil globally, the government is thinking over various options to reduce the subsidy losses of the oil marketing companies and at the same time trying to monimize the burden on consumers. According to the media one major reason for is raising fuel price hikes and cutting the duty at the same time. So, even if the retail petrol and diesel prices are increased, a duty cut would make the net increase marginal.
Another such proposal under consideration is to sell petrol at market price while keeping diesel, cooking oil and kerosene at subsidized rate, said an industry official. According to an industry analyst, crude trading firm is above $130 and it’s impossible to continue with subsidies. On the other hand, the government needs to safeguard the poor by regulating diesel, cooking gas and kerosene prices. So, it’s likely that government will cut the petrol price subsidy.
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