He said “The immediate impact of increase in any administered price like this will push the price index up. But we need to look at from long term point of view. We also need to look at from the angle that in the absence of such a measure fiscal deficit would have been higher.”
He added that “Immediately, it can produce raise in the price index but over the year I think over the medium term it is the best thing to do.”
The government had recently increased the price of diesel by INR 5 a litre and capped the use of subsidized LPG cylinder to six in a year per family, evoking sharp protests all over the country.
Source - PTI
Diesel price hike may push up inflation in short run: PMEAC