However, analysts are wary of the implementation of this hike. The upcoming elections will raise a question mark whether this will actually be executed, they say.
RS Sharma, former CMD of ONGC feels that the panel must apply these suggestions for the government's own credibility. Otherwise, what is the sanctity of such committees if these are not accepted, he asks.
Meanwhile, RS Pandey, former oil secretary also raised concerns on the viability of these during polls. "The real issue is will finance ministry accept it. Will the consumers accept such a hike?" he asks.
Energy expert Narendra Taneja feels that the government would want to be in a comfort zone as long as there is no much upside in the international crude prices and the rupee.
Below is the edited transcript of their interview to CNBC-TV18.
Q: We have managed to access exclusive details of what Kirit Parekh has recommended. At one level he is suggesting perhaps the more practical thing of a diesel, LPG and kerosene prices hike instead of moving from export parity to trade parity or from trade parity to export parity. In an election year will these recommendations be taken seriously at all?
Sharma: It should be. This is the issue of the credibility of the sovereign government itself. When this panel was constituted, it has to be accepted that whatever their recommendation is should be accepted to the extent possible.
I do not think the total diesel prices one quantum increase would be feasible at this point of time, but the philosophy should be accepted and at least this becomes some ground for the government to go ahead.
We have the recommendations coming from the economists of high eminence. It is not that any politician is taking decision. It should now come out and give recommendation acceptance to the extent feasible.
Q: If you think that it is unlikely that this report is going to be accepted or at least anything is going to happen with these recommendations, do you believe it is going to be status quo then as far as subsidy-sharing mechanism is concerned?
Sharma: It will be very unfortunate, because otherwise what is the sanctity of making these committees and then their recommendations not getting accepted.
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