Diesel prices in India have been regulated for a reason - to help develop the transportation & agriculture industry. Otherwise all across the globe in almost all developed & developing countries the diesel cost is at par or marginally higher than petrol. For every liter of diesel sold out there in the petrol bunks, the government has to shell out a considerable amount (subsidy) from its accounts - which contributes to the fiscal deficit of our economy.
Now we as normal users (not me
) are trying to bank on this opportunity in a big way by buying & running diesel cars. Government is forced to de-regulate diesel prices because consumption is increasing day-by-day and the subsidy it needs to shell out is exponentially increasing. This effectively adds to the fiscal deficit of our economy. Now increased diesel prices mean increased transportation costs which in turn lead to increase in foodstuff price - inflation.
The extra price that one pays for a diesel engine directly goes to the manufacturer (since diesel engines are expensive to make). Government does not get anything out of it. In my view the govt should introduce some additional taxes for diesel engines (private only) which might reduce the subsidy based fiscal deficit to an extent.
Would I still drive a diesel engine even when the prices are de-regulated? Definitely (only if it is non-subsidized) yes, because I love the driving dynamics of a diesel engine and its non-linear power curve coupled with the excellent fuel economy. But what about the increased transportation & foodstuff prices that have been partially
caused by the indiscriminate use of this subsidized fuel? PS: These are solely my personal views based on some facts and figures. This is in no way intended to hurt the sentiments of all diesel-heads out there...