Making a case for free market economy to boost investments, Oil Minister Dharmendra Pradhan on Thursday said the market price of petroleum products should commensurate with production rate to augment output and subsidies on such items must be for poor households only.
“The market price should be near to production price. We have to adopt a market mechanism. Government should not control prices (of petroleum products),” the minister said at the India Economic Summit here.
The minister was also of the view that freeing price of petroleum products is necessary to boost the investors confidence and increase private players participation in energy sector.He suggested that the without removing subsidies India cannot augment production of petroleum products in the country.
He also stressed that the subsidies should be targetted and should not be available to everybody for increasing investors confidence. Besides there should be a debate on this.At present, the government still provides subsidy on kerosene and cooking gas (LPG).
Government has been trying to persuade consumers to give up their LPG subsidy so that it could be provided to deserving below poverty line or poor families.The minister was of the view that the gas and renewables like solar and wind energy has a future in India in the long term and their proportion will increase in the energy mix in coming days.The Minister also emphasised the need to monetise farm waste.