The apex auto lobby, Society of Indian Auto Industry (SIAM) has asked the Indian government to stop providing subsidies on diesel and demanded for deregulation of diesel prices. As per the automotive body, instead of providing subsidy on diesel, the government can offer subsidy to farmers by providing credit.
According to SIAM, this move will probably bring down the gap between the prices of petrol and diesel, which might lead to a positive impact on the Indian economy. Further, SIAM reported that industry experts are also expecting a hike in diesel prices in the declaration of Union Budget 2013, which is expected to come soon.
On auto sector outlook, SIAM is not expecting any important improvement in the Indian auto sector in last quarter of current fiscal year as the auto sales declined in last quarter of 2012 as well as last year. Further apex auto lobby added that the next year's sales depend on the action that government will take in coming budget regarding the infrastructure spending.
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