05-29-2009, 09:19 PM
<!--QuoteBegin-->QUOTE<!--QuoteEBegin--><b>Govt to move on freeing state-set fuel prices</b>
pioneer.com
Reuters | New Delhi
India is likely to allow market pricing of fuels, a move that will help firms like Reliance Industries revive their retail networks and ease the subsidy burden on a government trying to balance growth with fiscal prudence.
Oil minister Murli Deora said the cabinet would consider a proposal to free state controls on fuel prices.
"It will go to cabinet. It will be discussed soon, within six weeks," Murli Deora told reporters soon after he was re-appointed as oil minister following the re-election of Prime Minister Manmohan Singh's government.
Deora's public comments were interpreted by markets as sign that approval was likely, and shares of explorers and oil refiners surged.
<b>The oil and gas sector index, which includes Reliance and state-run explorer ONGC, was up 4.6 percent by 0715 GMT,</b> outperforming the broader 30-share BSE index that was up 2.6 percent.
Oil prices rose above $65 a barrel on Friday, taking gains to 27 percent in May, and analysts say the market seemed focused on the bullish sentiment and brighter macroeconomic outlook.
......
Pricing freedom would <b>increase tax revenue and remove massive subsidies bills</b>, <b>helping offset the cost of economic stimulus measures that have stretched public finances and widened the fiscal deficit to 6 percent of GDP</b>.
Market-driven prices would help curb fuel use in India, one of the only major consumers expected to see positive demand growth this year.
<!--QuoteEnd--><!--QuoteEEnd-->
Well government is run out of public money, increase tax collection so that some people can have your money. Redistubution of money from acheievers to non productive lot.
pioneer.com
Reuters | New Delhi
India is likely to allow market pricing of fuels, a move that will help firms like Reliance Industries revive their retail networks and ease the subsidy burden on a government trying to balance growth with fiscal prudence.
Oil minister Murli Deora said the cabinet would consider a proposal to free state controls on fuel prices.
"It will go to cabinet. It will be discussed soon, within six weeks," Murli Deora told reporters soon after he was re-appointed as oil minister following the re-election of Prime Minister Manmohan Singh's government.
Deora's public comments were interpreted by markets as sign that approval was likely, and shares of explorers and oil refiners surged.
<b>The oil and gas sector index, which includes Reliance and state-run explorer ONGC, was up 4.6 percent by 0715 GMT,</b> outperforming the broader 30-share BSE index that was up 2.6 percent.
Oil prices rose above $65 a barrel on Friday, taking gains to 27 percent in May, and analysts say the market seemed focused on the bullish sentiment and brighter macroeconomic outlook.
......
Pricing freedom would <b>increase tax revenue and remove massive subsidies bills</b>, <b>helping offset the cost of economic stimulus measures that have stretched public finances and widened the fiscal deficit to 6 percent of GDP</b>.
Market-driven prices would help curb fuel use in India, one of the only major consumers expected to see positive demand growth this year.
<!--QuoteEnd--><!--QuoteEEnd-->
Well government is run out of public money, increase tax collection so that some people can have your money. Redistubution of money from acheievers to non productive lot.