A Re­form Long Over­due

The Economic Times - - Economy: Macro, Micro & More -

The over­haul of the sub­sidy regime for oil prod­ucts is long over­due. Now that there’s ‘di­rect ben­e­fit trans­fer’ of sub­ven­tions to house­holds be­low the poverty line, up-front sub­sidy on do­mes­tic fuels for the non-poor makes no sense. Be­sides, oil sub­si­dies dis­tort de­mand and en­cour­age di­ver­sion. In­stead of such con­sump­tion sub­si­dies, we need bet­ter re­source al­lo­ca­tion for so­cial and phys­i­cal in­fras­truc­ture.

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