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LPG quota hike a misdirected subsidy: Rajan

New Delhi: Terming the increase in quota of subsidised LPG as “misdirected subsidies”, RBI Governor Raghuram Rajan today said the move will end up benefiting people who can afford to pay market rates.“...what one should
India TV News Desk January 30, 2014 22:57 IST
India TV News Desk
New Delhi: Terming the increase in quota of subsidised LPG as “misdirected subsidies”, RBI Governor Raghuram Rajan today said the move will end up benefiting people who can afford to pay market rates.

“...what one should be careful about is expanding the misdirected subsidies in the system. We have to be very careful because we need to spend on very important things we are not spending on,” he told Karan Thapar on his programme Devil's Advocate on tv news channel.

When asked whether hike in LPG quota was a “misdirected subsidy”, Rajan nodded in affirmation.

“I believe there is a certain amount of population that can benefit from subsidised LPG cylinders. But beyond certain point you are reaching people who can well afford to pay for it. Now whose pocket is it coming from. Its coming from the pockets of people who are getting subsidised,” he said.