OECD Economic Surveys: India 2011
Hide / Show Abstract

OECD Economic Surveys: India 2011

OECD's periodic review of India's economy.  This edition includes chapters covering sustaining growth and improving living standards, fiscal policy, energy subsidies, financial reform, and education.

Click to Access: 
Publication Date :
14 June 2011
DOI :
10.1787/eco_surveys-ind-2011-en
 
Chapter
 

Phasing out energy subsidies You do not have access to this content

Click to Access: 
Author(s):
OECD
Pages :
95–118
DOI :
10.1787/eco_surveys-ind-2011-6-en

Hide / Show Abstract

India’s energy subsidies are large by any standard and impose enormous fiscal costs on the central government and, in turn, on Indian taxpayers. They also entail economic and environmental costs and primarily benefit wealthier households. Phasing out energy subsidies and allowing greater latitude for price signals to operate in energy markets would increase economic efficiency and reduce greenhouse gas emissions over the long run. A number of steps have been taken recently in this direction, including a change in gasoline pricing, as well as efforts aiming at moving away from the current system of subsidies on kerosene and liquid petroleum gas towards direct help in cash for people with incomes below the poverty line. Higher world oil prices have overwhelmed these efforts, however. Targeted cash transfers would help shield low-income households from increases in energy prices though they will be difficult to implement effectively.
Also available in: French