New Delhi   

Delhi softens fuel price hike blow

– PHOTO: S. SUBRAMANIUM

NEW VISTAS: The brand new air-conditioned low-floor buses flagged off by Chief Minister Sheila Dikshit in the Capital on Thursday, World Environment Day, as part of a drive to popularise public transport.

NEW DELHI: Acting on the advice of Prime Minister Manmohan Singh and Congress president Sonia Gandhi, the Delhi Cabinet on Thursday decided to soften the impact of the sharp increase in prices of fuel and gas by removing Value Added Tax and subsidising the sale of cooking gas. As a result, the price of a domestic cooking gas cylinder in the Capital would now effectively go up by only Rs.10 rather than Rs.50. The new rate would be Rs.304.70 per cylinder.

Addressing a press conference soon after the Cabinet meeting, Chief Minister Sheila Dikshit said her government had decided to bear the financial impact of reducing the domestic LPG cylinder prices since “the biggest burden due to the increase in prices had been felt by the households in Delhi”.

“Ours is a sensitive government and in the last nine and a half years we have done nothing with an eye on the elections. Even this time round we have stepped in to protect the interests of the households,” she said.

On the economics involved in the decision, the Chief Minister said the Delhi Government would bear the Rs.165-crore burden that had been brought about by the reduction in both VAT and subsidy.

The Government has removed the 4 per cent VAT on LPG cylinders through which nearly Rs.13 per cylinder accrued earlier. The reduction in VAT and the subsidy would benefit about 44 lakh domestic gas users in the Capital who use up close to 4.5 crore cylinders a year.

The Chief Minister said her government would now reduce certain expenditures to overcome the deficit on account of lower recoveries through LPG. As a first step it has been decided that no official delegation would be permitted to go abroad. The Government would also closely monitor its expenditure and make it more rational and justified and ensure utilisation of allocated funds for social schemes.

As for petrol and diesel, the Chief Minister said their prices had not been touched as they were used primarily by private vehicle owners in Delhi. Since the city’s entire public transport fleet including buses, taxis and autos runs on compressed natural gas (CNG) and the Delhi Metro railway runs on electricity, the cost of public transport had not gone up, she pointed out.

The Chief Minister said the Cabinet had also decided to not effect an increase in bus fares. She said attempts were being made to make public transport in the Capital more comfortable, affordable, fast and modern so that more and more people prefer to travel by it.

To that end, Ms. Dikshit flagged off a fleet of brand new air-conditioned Delhi Transport Corporation buses at India Gate on Thursday.

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