The government has been making periodic changes in the prices of petrol and diesel depending upon international prices which effectively is as good as deregulation, Union Petroleum Minister Murli Deora said today.
However, he indicated that overall deregulation of petroleum products, which includes kerosene and LPG used by the poorer section of the society, need to have human face.
Speaking to reporters after inaugurating International Dawoodi Bohra Trade Exhibition here, Deora said the recent Budget has provided as much as Rs 30,000 crore towards subsidies for kerosene and LPG.
The government has not raised kerosene prices for 10 years, he said and indicated that the fuel of the poor people would continue to be subsidised.
He said the government has been making periodic changes in petrol and diesel prices depending upon international prices and “it is as good as deregulation”.
Responding to a query on whether the government has dropped plans for overall deregulation of petroleum prices, he said, “deregulation need to have a human face”.
As a policy, petroleum prices are regulated by the government which results in huge subsidy burden on the government.
While Deora tended to be soft on kerosene and LPG, he justified the recent increase in the prices of petrol and diesel arguing the oil companies fall under the Navaratna category and they cannot sell at a loss.
He pointed out the domestic prices were raised only when the international prices went up from about $50 a barrel to $75 a barrel.
He said the government could consider to reduce the prices if the international prices fall and stabilise at that level for 4\5 weeks.
Deora said the government had earlier reduced the domestic prices of petrol by as much as Rs 10 per litre when there was a sharp fall in international prices.
Meanwhile, the minister announced that the entire city of Mumbai would get piped gas for cooking over the next two years. At present only about 380,000 homes in the city have been given piped gas connection.
