Energy subsidy is a bad idea: Montek

As the debate is on to decontrol fuel prices, the Planning Commission Deputy Chairman Montek Singh Ahluwalia today said it would be a bad idea to continue with subsidies to keep oil prices subdued.

"It is an exceptionally bad idea to continue with energy subsidies...Which means that energy prices would be lower and never go up again," Ahluwalia said, while releasing a report on 'Post-Crisis Growth in Developing Countries', by the Commission on Growth and Development in which he is a member.

"I cannot say we have dealt with that (energy subsidies) but I can say that we are facing that issue very squarely," Montek said adding, "it would be a bad idea to continue with energy subsidies on the assumption that commodities prices will not rebound after crisis."

Recently, Ahluwalia had said decontrolling fuel prices will not flare up inflation, but rather it will soften generalised rise in prices. "Decontrolling fuel prices will not flare up inflation. I just think it is not sustainable to have prices those are not line with the world prices," he had said.