Reform, Oil price deregulation and Modi Govt

When Narendra Modi with his extraordinary leadership skill, campaigning ability took BJP to a new height and won the Lok sabha election with majority of seats to their credit. Modi’s agenda of Lok Sabha election was growth, development, job creation, reform etc but somehow initially with price hike of railway fare and some other issues triggered comments from investors and the public.

Modi reacted it positively and took steps to keep the Indian economy on track. His ministers are handling multiple portfolios; he brought Arvind Subramanian, prominent economist to formulate reform policy and budget.

Disinvestment of ONGC stake and some other state run companies will fulfill finance ministry’s target of raising money from asset sales. Finance ministry hopes to raise 3 billion dollar from the sale which is estimated to be a quarter of their target of the financial year.



Disinvestment is in the agenda, Center has also deregulated diesel price which will indeed reduce inflation to some extent while the increase in Gas Tariff by 46 percent that will give rise in the price of fertilizer, power,CNG and PNG .

After 5 year it is a major reduction in the price of diesel by 3.71 Rs per liter while the increase in tariff in Gas will burden the consumers 4.25 per kg of CNG and 2.6 per Kg in cooking Gas. Increase in the price of Gas will help in increased investment for drilling and exploration.

Govt removed deregulation from diesel which means that if the international crude price increases in the future govt will have no obligation to provide subsidy to the oil companies.

 

By : | Category : Business and Economy| Sub Category : Indian Business News|Date : October 21,2014

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