The government of India has a major problem to tackle this financial year- Fiscal Deficit. It has tried all possible means to reduce the deficit to the acceptable level. Subsidy bill are a major part of government spending in India. So GOI is now determined to reduce the subsidies on diesel. It has now agreed to deregulate the prices of diesel in a gradual manner. So is the case with LPG cylinders. These steps suggest the desperate need of the government to bring its spending below the threshold. Another important step that has been taken is disinvestment of PSUs.
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