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Montek favours fuel price hike

Special Correspondent

"Fiscally irresponsible" not align domestic prices with global ones

NEW DELHI: Deputy chairman of the Planning Commission Montek Singh Ahluwalia said it would be "fiscally irresponsible" not to align domestic oil prices with global prices, which are hovering around $65 a barrel.

He said the Government had to do it in line with all other countries. If fuel prices were not adjusted, there would be a "hidden subsidy" on oil products. This would have a damaging effect on the oil companies and could have an adverse impact in the long run, he said.

Speaking on the sidelines of an Amcham conference here on Monday, he said subsidies of this scale could not be put directly on the Budget without adverse consequences. Exceptions could be made with targeted groups, but otherwise any mis-alignment was in fact a hidden subsidy. It was the normal practice of good economic management not to have open-ended subsidies on items on which international prices were shooting up, he said.

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Montek favours fuel price hike

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