Finance minister Pranab Mukherjee on Tuesday suggested that the government was open to increasing the fuel subsidy beyond the budgeted level, if needed.
The statement made during an interaction with over 30 institutional investors is likely to provide comfort to oil marketing companies which are saddled with mounting losses due to their inability to align the retail prices of diesel, cooking gas and kerosene oil to global prices. Even the fuel buyer can draw breathe a little easy as the pending hikes might not be as sharp as expected.
Though this does raise questions over the government's ability to meet the annual fiscal deficit target of 4.6% of GDP, Mukherjee tried to allay investor fears saying that despite the increased liability the government would be able to stick to its estimate.
The statement made during an interaction with over 30 institutional investors is likely to provide comfort to oil marketing companies which are saddled with mounting losses due to their inability to align the retail prices of diesel, cooking gas and kerosene oil to global prices. Even the fuel buyer can draw breathe a little easy as the pending hikes might not be as sharp as expected.
Though this does raise questions over the government's ability to meet the annual fiscal deficit target of 4.6% of GDP, Mukherjee tried to allay investor fears saying that despite the increased liability the government would be able to stick to its estimate.
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