Diesel subsidy withdrawal unaffordable, says minister

Last Updated: Fri, Feb 04, 2011 15:11 hrs

New Delhi: India cannot afford to withdraw the subsidy on diesel and it has to continue till poverty disappears from the country, union Minister for New and Renewable Energy Farooq Abdullah said on Friday.

Speaking at the Delhi Sustainable Development Summit here, Abdullah said India gives a lot of subsidy on diesel and, if withdrawn, it will only increase inflation.

'Diesel subsidy has to continue till poverty disappears from the country,' he said while reacting to Canadian parliamentarian Stephane Dion's appeal to phase out diesel subsidy.

'The fossil fuel subsidy amounts to $312 billion across the world and, according to a study, about 80 percent of diesel subsidy went to 40 percent of the rich people. We need to pitch for universal phase out of fossil fuel subsidy and bring it to core of the international negotiations,' said Dion.

Abdullah said the world needs to work together to protect each other.