The government needs to take the unpopular step of cutting fuel and fertiliser subsidies as early as possible in order to contain fiscal deficit,said C Rangarajan,chairman of the Prime Ministers Economic Advisory Council here on Friday.
It is extremely important for the economy,at this juncture,to keep the fiscal deficit at the budgeted level of 5.1 per cent of GDP, he said.
Rangarajan,who has been saying that the government should hike petrol prices in small steps,has also advocated decontrolling prices of diesel and LPG although such steps may make it unpopular.
As far as prices of diesel or LPG is concerned I believe that adjustments with the market prices is needed, said Rangarajan.
Asked for a time-frame for the government to cut subsidies,Rangarajan said: I cannot predict a time-frame,but actions will be taken because actions will be needed.
FE
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