New Delhi, Apr 24 - The government today said that it has taken an in-principle decision to link diesel prices with market rates, a move, which the opposition BJP asserted would push up the prices of essential transport fuel.
"Government has, in principle, agreed to make the prices of diesel market determined ...There is no proposal at present to fully deregulate cooking gas price" Minister of State for Finance Namo Narain Meena said in a written reply to the Rajya Sabha.
While petrol prices are market-linked, the government fixes the rates of LPG, kerosene and diesel, which results in a large budgetary expenditure on subsidies.
The government, Meena said, continues to fix the price of diesel in order to shield the common man from the impact of rising crude oil prices and the resultant inflation.
"In order to insulate the common man from the impact of rise in international oil prices and the domestic inflationary conditions, the government continues to modulate the retail selling price of diesel," the Minister added.
Attacking the government for its decision to free diesel prices, BJP spokesman Prakash Javadekar said, "They (government) are saying that they are doing it in-principle and they will modulate it to the needs of the people. But this means that they are going to increase diesel prices and the diesel shock is coming in few days from now."
Finance Minister Pranab Mukherjee later told reporters, that the in-principle decision to deregulate diesel prices was taken in June last year.
The Minister, however, did not respond when asked whether the government would stick to its decision. PTI