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Here is an article in which the PM Dr Manmohan Singh is trying to make a case for increasing fuel prices.

He is clear in his article that the subsidy for the fuel is to go. Yes Certainly. What is ignored here is that the Tax component which is often more than 50% is being ignored. The government subsidizes the tax which it collects. if the taxes are as normal as other items, the prices can be deregulated.I think, the government shall think to reduce the taxes before adding additional burden on the poor common man. 

Secondly even the subsidies are targeted at wrong reasons. the rise of diesel car sales is primarily attributed to the low cost of diesel which is subsidized. Almost all the SUVs which run on diesel are fuel guzzlers.

Indian govt is subsidizing the rich people who own cars, and encouraging the car culture. If well-off people want to drive a big car, then pay the FULL MARKET PRICE for the petrol!Worst of all is cross subsidy on diesel to Petrol, which is used in 2 wheeler and used by more ‘aam’ Admi.

May be it is time for someone like Anna Hazare to take this issue up. Noone is interested to take the statistics of how much is used by the poor people. 

One thing which can be done is to de-regulate the price in all the cities. Which agriculturist will be buying the diesel for the pump from the city. 

The oil companies also putting pressure on the government to increase the price. But the government is dependent on Mamtaji. 

The subsidy wont go, prices will raise and lots of lip service will be there for reducing the subsidy

Originally posted 2012-04-30 03:20:00.