The central government hiked the prices of diesel, kerosene and cooking gas respectively by Rs.3 per litre, Rs.2 per litre and Rs.50 per cylinder with effect from Friday midnight.
"It was inevitable...prices had to be increased. It is not surprising. We all know that the costs of diesel, kerosene and cooking gas are much higher. How long can the government provide subsidy?" Emami Limited director Manish Goenka told IANS.
"For a common person, I understand the problem," he added.
Shyam Steel director Lalit Beriwala said there will be inflationary pressure in the economy due to the price hike of diesel.
"Diesel price hike will have an impact on the industry. There will be more inflationary pressure. Logistic and transport costs will be increased because of the price hike," he said.
Stating that the steel industry was passing through a bad time, Beriwala said the increase in logistic and transport costs will put steel makers in a more disadvantageous position.
"The government cannot continue subsidy on petro products. It is economy's harsh reality. This was the government's very hard decision. It must have considered all options also," Patton Group of Companies managing director Sanjay Budhia said.
He, however, said the price hike will have an inflationary pressure on entire commodity prices. "Total impact will be a sizeable one...reality is tough for the common man."
Bengal National Chamber of Commerce and Industry (BNCCI) secretary D.P. Nag said the government should have avoided the price hike as inflationary tendency will be very high.
"The Reserve Bank of India (RBI) is consistently increasing the bank rate to tame inflation, but the price hike of petro-products will have a wide-spread effect on inflation," Nag said.
The government could have given tax relief to the loss-making oil companies instead of increasing the prices of diesel, kerosene and cooking gas, he added.
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