Latest Car News in India

Thursday, September 08, 2011

By Pranjal Gera

The Possibilities of Diesel Cars Price Hikes

The automobile companies have strongly opposed the idea of increasing the tax on diesel cars. According to them this will adversely affect the sales of Diesel cars in the market.

At present, Diesel cars are in more demand than petrol cars, in India. This is because of the lower prices of Diesel, and the expensive technology.

Mahindra & Mahindra's President for Automotive Sector, said that the diesel and petrol price parity is right. He said that government shouldn't take a decision to end it at this time, when the market is facing a low.

Last year, governments decided to decontrol the prices of petrol. However, as far as the diesel fuel is concerned, the government is struggling to come to a decision. Some of its ministers are in support of decontrolling the fuel. Whereas, the rest of them are against it. Planning Commission's Chairman Montek Singh Ahluwalia is in support of the plans of decontrolling the fuel's prices. Whereas, Praful Patel, Minister of Heavy Industries, is against it and says that the government shouldn't do it as it has a social obligation as well.

Mr. Patel assured that there is no possibility of the government freeing diesel prices, in the near future. He also said that the government should really rethink about calling diesel as dirty fuel, as it is fast emerging as better option than petrol in developed countries.

Though Patel has confirmed against it, and there is no official announcement from the government regarding the same. Still the situation remains quite unclear.

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