India's oil minister shied away from introducing comprehensive energy subsidy cuts on Tuesday, instead calling on his countrymen to embrace car pooling, buses and cycling as well as staggered working hours in a bid to curb fuel consumption.
The struggling Asian economy - the world's fourth-largest user of energy - is battling a weak rupee that has increased the price of oil products as economic growth has halved to 4.4 percent from the 8-9 percent seen in the boom years.
Delhi is also seeking to rein in a record current account deficit that is in part fuelled by energy imports. A falling rupee also boosts inflation and the wholesale price index measure of inflation, the benchmark for the country's central bank, rose to a six-month high of 6.1 percent in August.
M. Veerappa Moily told a news conference on Tuesday he hoped to save $5 billion (3 billion pounds) from fuel conservation measures even as he shied away from substantial measures such as raising diesel and other fuel prices as the electoral cycle hots up with polls due to be held by May 2014.
"As of now there is no proposal to raise prices," Moily said, referring to diesel subsidy changes.
India, where energy consumption per person is among the lowest in the world, has little room to cut fuel use as it tries to power exports and agriculture.
Diesel accounts for more than 40 percent of fuel demand, or around 1.4 million barrels per day, the bulk of which is used by trucks, farmers and industry.
The $5 billion savings is part of a campaign outlined earlier this month to save up to $25 billion this year, although the weak Indian currency and rising global oil prices already mean that rupee price hikes for diesel have failed to match the dollar price gains for oil.
The government realistically aims to save about $12-15 billion, a source familiar with the plans told Reuters after Moily's press conference.
INFLATION WORRY
"The biggest concern right now is inflation. Any kind of fuel hike will trigger an upside on inflation, so what they are trying to do is appealing to the people to sort of cut down on consumption," said Praveen Kumar, who leads the South Asia oil and gas research team at FGE in Singapore.
Moily was widely ridiculed for earlier plans to close petrol stations at night in a bid to curb demand, a plan that has been quietly dropped.
Instead Moily said on Tuesday he had requested "staggered office timings for government offices, which will help in decongesting road traffic" and issued a plea for Indians to drive safely, share cars and use public transport.
India fails to bite the bullet to cut fuel demand | Reuters
The struggling Asian economy - the world's fourth-largest user of energy - is battling a weak rupee that has increased the price of oil products as economic growth has halved to 4.4 percent from the 8-9 percent seen in the boom years.
Delhi is also seeking to rein in a record current account deficit that is in part fuelled by energy imports. A falling rupee also boosts inflation and the wholesale price index measure of inflation, the benchmark for the country's central bank, rose to a six-month high of 6.1 percent in August.
M. Veerappa Moily told a news conference on Tuesday he hoped to save $5 billion (3 billion pounds) from fuel conservation measures even as he shied away from substantial measures such as raising diesel and other fuel prices as the electoral cycle hots up with polls due to be held by May 2014.
"As of now there is no proposal to raise prices," Moily said, referring to diesel subsidy changes.
India, where energy consumption per person is among the lowest in the world, has little room to cut fuel use as it tries to power exports and agriculture.
Diesel accounts for more than 40 percent of fuel demand, or around 1.4 million barrels per day, the bulk of which is used by trucks, farmers and industry.
The $5 billion savings is part of a campaign outlined earlier this month to save up to $25 billion this year, although the weak Indian currency and rising global oil prices already mean that rupee price hikes for diesel have failed to match the dollar price gains for oil.
The government realistically aims to save about $12-15 billion, a source familiar with the plans told Reuters after Moily's press conference.
INFLATION WORRY
"The biggest concern right now is inflation. Any kind of fuel hike will trigger an upside on inflation, so what they are trying to do is appealing to the people to sort of cut down on consumption," said Praveen Kumar, who leads the South Asia oil and gas research team at FGE in Singapore.
Moily was widely ridiculed for earlier plans to close petrol stations at night in a bid to curb demand, a plan that has been quietly dropped.
Instead Moily said on Tuesday he had requested "staggered office timings for government offices, which will help in decongesting road traffic" and issued a plea for Indians to drive safely, share cars and use public transport.
India fails to bite the bullet to cut fuel demand | Reuters
