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How will this affect industry?

Indian industry chambers hailed the fuel price hike affected by the government on Wednesday.

india Updated: Jun 04, 2008 22:29 IST
HT Correspondent

Indian industry chambers hailed the fuel price hike affected by the government on Wednesday. Hailing the government’s decision of hiking petrol prices by Rs. 5, diesel by Rs. 3 and liquefied petroleum gas or cooking gas by Rs. 50 per cylinder the Confederation of Indian Industries (CII) said government’s decision was unavoidable.

“India cannot afford to compromise its growth process and needs to better target the subsidy outgo in order that the poorest are protected. This is also a time, when we really need to take a very close look at India’s energy efficiency,” CII President KV Kamath, Kamath said, in his reaction to hike in petroleum products.

While the Federation of Indian Chamber of Commerce and Industry said the hike would “provide cushion to the under recoveries of approximately Rs. 550 to 600 crores.” It also added that there is further scope of providing cushion to the oil marketing companies by restructuring the sales tax regime on petroleum products at the state level.

ASSOCHAM president Sajjan Jindal, felt that the hike would lead to inflation but added that it was time for every one to bear the brunt of increased prices of petroleum.