India: State Planning Commission Calls for Change
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Thursday, 03 September 2009 |
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The Planning Commission in India has called for linking petrol and diesel
prices with international markets and made a case for raising gas
prices by public sector companies.
"Natural gas prices of PSUs (are) very low and need revision,"
the commission said in a presentation on Integrated Energy Policy (IEP)
before the Plan Panel meeting chaired by Prime Minister Manmohan
Singh. The commission suggested there should be greater clarity
on gas pricing policy in the eighth round of NELP (New Exploration and
Licensing Policy). It also called for linking petrol and diesel
prices with international market and said that large subsidies in
kerosene and LPG should be better targeted to benefit the below poverty
line (BPL) families.
Subsidised prices of LPG and kerosene are "greatly misaligned and imply
a very large subsidy. This is leading to huge uneconomic use and
unintended benefits to certain classes of consumers and widespread
adulteration of petrol and diesel," the presentation said. Favouring
stable price regime in the oil sector, the presentation said, it would
encourage private oil companies to develop retail network for sale of
petrol and diesel.
"Private oil companies (are) not using/developing retail network for
sale of petrol and diesel in the absence of stable price regime," it
said.
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