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This is an archive article published on December 17, 2005

Manjunath murder: ‘pricing is key’

Petroleum Minister Mani Shankar Aiyar today informed Prime Minister Manmohan Singh that “market pricing” of kerosene is the only e...

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Petroleum Minister Mani Shankar Aiyar today informed Prime Minister Manmohan Singh that “market pricing” of kerosene is the only economic solution to curb adulteration of diesel. And other than dual pricing of kerosene—one rate for Below Poverty Line customers, another for the rest—the Government could consider providing cash or coupons to compensate for the price differential.

At a meeting of the Energy Coordination Committee specially called in the wake of IOC sales officer S Manjunath’s murder, Aiyar suggested that the problem of kerosene diversion and subsidy would be automatically resolved if the price difference between kerosene and diesel was removed.

A “possible alternative’’, said Aiyar, was to provide an income support system under which cash or coupons of Rs 50 per month is distributed by the elected gram panchayat to the intended beneficiaries at the gram sabha to make up for the subsidy elimination.

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The other possibility was to gradually eliminate the subsidy — currently at Rs 11-12 per litre — with dual pricing of kerosene.

While lauding the oil companies for taking measures to curb kerosene diversion, Aiyar said: ‘‘There can be no effective policing or prosecution without the active cooperation of state governments. However, few state governments are willing to acknowledge this, let alone rectify it, leaving to some suspicion of a possible nexus between politically influential elements and the growing mafia in the adulteration business.”

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