`Govt to talk to allies on fuel price hike`

Last Updated: Wednesday, March 3, 2010 - 12:43

New Delhi: Finance Minister Pranab Mukherjee on Wednesday said that the government would talk to its allies on the issue of fuel price hike but gave enough hints that a rollback would be difficult.
Party sources said that Mukherjee briefed the Congress
MPs about the salient features of the budget in the backdrop
of the demands for a rollback in fuel prices and explained why
reduction in the excise duty on petroleum products was
difficult.

The Finance Minister informed the Congress MPs about
the challenges before the government in the current economic
scenario.

Mukherjee is learnt to have told the MPs that since no
new taxes have been imposed in the Budget and the government
is expecting a GDP of 8.5 percent from 7.2 percent in the
outgoing financial year, some steps were required to mop up
revenues. This was more so as the government plans to invest
heavily in the social sector schemes, the sources said.

He also gave a comparative chart of the fuel price
hike done under the UPA and the NDA respectively in which he
explained that the rise in prices of petroleum products was
far less during the UPA rule as compared to that of the NDA.

Mukherjee also told the MPs that the minimum support
price for foodgrains was doubled under the UPA as compared to
that under the NDA.

Congress President Sonia Gandhi is expected to explain
the party`s position on the issue of rollback when she
addresses a meeting of the Congress Parliamentary Party
tomorrow.

Talking to reporters outside Parliament House, Union
Minister Ambika Soni, who also attended the meeting, said "You
have to create growth and for growth creation you need to pump
in money".

She was asked whether the government is going to
rollback the increase in excise duty on fuel.

Another party MP Jagdambika Pal said that petroleum
prices were increased 33 times during NDA rule and stressed
the need for economic reforms to achieve high GDP.

"We will tolerate this burden and price rise will also
not be allowed to hit people," he said.

Sources said the Finance Minister had also told the
MPs that steps like increase in excise duty is required if
higher growth rate is to be achieved.

The Congress Core Group had grappled with the issue
last night and had apparently decided to back Prime Minister
Manmohan Singh, who has indicated that rollback would not be
possible.

PTI



First Published: Wednesday, March 3, 2010 - 12:43

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