Diesel price hiked by Rs 5 per litre

The government of India has decided to hike the price of diesel by Rs 5 per litre, to be effective from midnight.

The decision of diesel price hike has been stirred by the Cabinet Committee of Political Affairs (CCPA) that is headed by Prime Minister Manmohan Singh.  The Cabinet however, has left the price of petrol, kerosene and LPG untouched.

The Cabinet agreed to raise the cost of diesel by 12 per cent or Rs 5 per litre excluding VAT and has also restricted sales of LPG cylinders to six per consumer annually.

The politically bold move is aimed at reining in the country's heavy fiscal deficit and fend off the threat of being the first in the BRICS group of emerging economies to be downgraded to junk.