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Journalism of Courage
Urban India8217;s fuel of choice has just become more expensive in Delhi. In the city8217;s new budget, sales tax on diesel has been raised from 12 per cent to 20 per cent 8212; translating into an increase of Rs 1.5 per litre from its pre-budget Rs 22.74. As for those big cars guzzling up fuel 8212; diesel and gasoline 8212; on Delhi8217;s cramped roads, their cost to owners has also gone up. They will now pay higher road tax. Good. Levying new taxes is usually not advisable 8212; but, as always, the wisdom of that statement lies in progressive exceptions. These measures should go some way in addressing the absurd subsidy on diesel enjoyed mostly by rich farmers and wealthy owners of sports utility vehicles. And if augmented with smart interventions, in Delhi and in other cities, they could help decongest our roads and nudge people from private vehicles to public transport systems.
Cities have to determine ways and means of discouraging car owners from diesel-fuelled vehicles. First, thanks to an irrational fuel pricing policy, diesel is greatly subsidised. In urban centres this has created an absolutely unintended circle of beneficiaries. Second, in any case diesel is not just an inefficient fuel, it is also relatively more polluting. As we move towards clean technologies like CNG, pricing mechanisms are also needed to consolidate the shift.
