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Fuel hike was a painful necessity: PM

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Our Bureau Hyderabad
Prime Minister Manmohan Singh on Sunday described the decision to hike petroleum and LPG prices as a 'painful necessity' and said that it had been done, keeping in mind the "totality of circumstances".
 
Addressing a press conference in the city today after inaugurating a national food for work programme in Ranga Reddy district of the state, Singh said that the Left parties had a point of view, but if the government had not taken a decision keeping in mind the the hike of crude prices internationally, it would have had disastrous effects on several 'Navratna' public sector oil units.
 
"The Left parties have a point of view, but if we do not adjust the prices of petroleum products then the profits of oil companies like Oil and Natural Gas Corporation (ONGC) will go down and they won't have enough money to invest in exploration activities. These are 'Navratna' units," he said.
 
Singh also said that the government could ill afford to absorb the rise in prices as the fiscal deficit of the central and state governments was an area of concern at 10 per cent of the total Gross Domestic Product (GDP) of the country. "We propose to discuss this issue with the Left parties and tell them that it (the hike) was unavoidable."
 
On the issue of using the country's burgeoning foreign exchange reserves for investment in public infrastructure related projects, Singh did not specify a time frame as to when a decision would be taken. "Several technicalities have to be worked out with the Ministry of Finance, Reserve Bank of India and other concerned ministries. A broad based consensus will be evolved on the issue," he said.
 
Ruling out third party intervention in resolving the Kashmir dispute, the Prime Minister said, the composite dialogue between India and Pakistan was making progress and efforts were on to achieve "credible and mutually acceptable solutions" to all outstanding issues including Kashmir.
 
Defending his decision to cut troops deployed in Jammu and Kashmir, Singh described it as an 'experiment' and said, "We have taken some risks but they are not unacceptable risks."
 
"There is no scope for third party intervention on Jammu and Kashmir. India and Pakistan are quite capable of dealing with the issues bilaterally on the basis of a composite dialogue," he told reporters here when asked about Pakistan President Pervez Musharraf's recent formulation on Kashmir.
 
Musharraf had, in an Iftar dinner on October 25, suggested identification of seven regions on both sides of Kashmir, "demilitarise them and change their status through either independence, or joint control or under a UN mandate".
 
Singh said the composite dialogue was making progress, and asserted that "We are working towards achieving credible and mutually acceptable solutions to all outstanding issues, including Kashmir."
 
Justifying his decision to cut troops deployed in the border state, Singh said the 'major reason' behind this was the reduction in infiltration levels.
 
"This (troop reduction) is the experiment we are trying. We have taken some risks but they are not unacceptable risks. We will make a constant review of this," he said and noted that there was "substantial improvement (in the situation) on the security front".
 
On what he hoped to achieve during his coming visit to Jammu and Kashmir, Singh said, "We want to reach out to the minds and hearts of the Kashmiri people. They have seen a lot of violence and suffered a great deal. We want to see a new chapter of hope and put the chapter of violence behind us."

 
 

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First Published: Nov 15 2004 | 12:00 AM IST

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