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SC gives nod to Centre’s decision to withdraw diesel subsidy for bulk consumers

The Supreme Court has set aside the stay orders passed by the Madras and Kerala high courts on the implementation of the central government policy on deregulation of diesel prices, saying that the economy is in bad shape and a pragmatic approach is needed to be taken on subsidies. This has cleared the decks now for the government for not providing subsidised diesel to bulk consumers of public utility services like the railways and the state transport corporations.

A bench comprising Justices R M Lodha and Madan B Lokur said that the ‘stereotypical thinking’ on subsidy has to be changed since now, it’s a question of economic survival. Hence, the public transport corporations have to find the means to sustain themselves without the benefit of receiving subsidy from the Centre.

‘We have to change the mindset. You (transport corporations) just cannot sustain on subsidy. You have to find ways and means to sustain yourselves. You have to start charging from the public. We cannot ignore the fact that oil is imported. How can you continue to survive on subsidy?’ asked the apex court.

The SC took into consideration that a staggering 83 per cent of the crude oil in India is being imported at present and any artificial subsidy on its price is bound to hit the public sector oil companies. It also suggested that the transport corporations should devise means to cut costs of operations.

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