"An increase in fuel prices is inevitable because it is the global economic slowdown including the global crude price hike that will influence economic growth," he stated after attending a seminar on "Economic Outlook 2012: Investment-Grade and Growing", here on Tuesday (March 27).
He noted that the surge in global crude prices may lead to a slowdown in the economy, prompting the government to cut its 2012 economic growth target to 6.5 percent from 6.7 percent previously.
"Therefore, the government has proposed a draft revision of the 2012 state budget to the House of Representatives. The draft is being discussed by the DPR and the government," he confirmed.
Asked to comment on the government`s plan to raise subsidized fuel prices, he said the government is focusing on addressing the impact of the global crude price hike and hopes it will not affect the state budget.
"The global crude price hike may make the state budget unsound due to the higher amount of budget funds that need to be allocated to the fuel subsidy, which will definitely go to those who are not entitled to it," he remarked.
Therefore, if the DPR approves the amount of fuel subsidy proposed by the government, the budget fund may be allocated to the sectors that will benefit the public the most, he said.
He added that the DPR`s budgetary board has approved several of the government`s proposals.(*)
Editor: Heru Purwanto
Copyright © ANTARA 2012
