Diesel price hike by Rs 5/litre, BJP on protest

Diesel Price 150x150 Diesel price hike by Rs 5/litre, BJP on protestDiesel Price hiked by Rs 5 per litre, the one of the biggest hit over industrial history in 15 months, by Cabinet from midnight a 14 percent rise, including taxes.

It is for the first time that Cabinet Committee on Political Affairs (CCPA) chaired by Prime Minister Manmohan Singh, raised limit over the supply of sensitive subsidized LPG gas as each family to have 6 cylinders per year, while for additional, people will have to pay more than Rs 700 per cylinder.

The long anticipated decision which is welcomed by industries, is hit the poor so hard which opposed by opposition parties, demanding roll back as like previous petrol hike issue. Terming it a biggest threat for common man to survive financially, they announced to start a protest march at the weekend.

“Nobody wants to put pressure on people but the subsidy bill had risen so high that this became inevitable,” Pawan Kumar Bansal, minister for parliamentary affairs, said, as per source.

This move comes to maintain fiscal deficit of Indian economy to survive as an essential step to take out from the rating agency downgrading dangerous zone.

“It is the first credible step towards fiscal consolidation that the government has taken, something for which the market has been waiting for long. It also gives some hope for a rate cut by the Reserve Bank of India,” Manish Wadhawan, MD, HSBC, Mumbai told reporters.

Hike in Diesel will lead to an inflationary move, while there is no increase in the petrol and kerosene oil prices.

Meanwhile, the govt. hoped that the decision would be helpful for a better revive of economy as well as investors’ confidence boost with a well credit downgrading rate in global market by reforming fiscal with a target of 5.1 percent of gross domestic product.

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