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India's Economic Survey released by Pranab Mukherjee in parliament on Thursday has indicated the decontrolling of petrol and diesel prices "at the earliest" and for the reforming of the subsidies to cooking gas and kerosene.
The survey said the subsidies rule, including that of liquefied petroleum gas (LPG) and kerosene must be reformed so that "all the needy get the intended benefit".
"Limit LPG subsidy to a maximum of 6-8 cylinders per annum per household," it said in its recommendations on fiscal sustainability and tax simplification.
"Limit LPG subsidy to a maximum of 6-8 cylinders per annum per household," it said in its recommendations on fiscal sustainability and tax simplification.
It added that kerosene subsidy could be totally phased out "by ensuring that every rural household (without electricity and LPG connection) has a solar cooker and solar lantern".
Under the title "energy dependence or independence", a slew of measures were suggested on the topic - the first of which called for "decontrol" of petrol and diesel prices.
"Develop a policy response system and financial buffer for use when diesel prices rise above the oil equivalent price of $80 a barrel (in 2008 prices)".
The government has issued oil bonds amounting to 59% of the subsidy burden to the state oil companies, with the rest borne by upstream companies, - Oil and natural Gas Corp (ONGC) and Oil India.
"Develop a policy response system and financial buffer for use when diesel prices rise above the oil equivalent price of $80 a barrel (in 2008 prices)".
The government has issued oil bonds amounting to 59% of the subsidy burden to the state oil companies, with the rest borne by upstream companies, - Oil and natural Gas Corp (ONGC) and Oil India.
India has seen an decline in domestic crude output last fiscal, but the production of petroleum products increased by 3.9%.
"Major reasons for the slowdown in growth included industrial slowdown, business slowdown in sectors like automobiles and transporters strike in January 2009," the report said. There had been an increase of 3% in refinery production.
Under the government's new exploration licensing policy, an amount of $10 billion has been committed April 1, 2009 on exploration, out of which just about $4.7 billion has been spent so far.
ONGC's overseas acquisition arm, ONGC Videsh, has produced over 8.78 million tonnes of oil from its assets in Sudan, Vietnam, Russia, Syria and Colombia in 2008-09.
During this period, OVL also acquired Imperial Energy.
During this period, OVL also acquired Imperial Energy.
