"Yes, it will bring effects such as rising prices of products. However it is a normal thing," said Wanandi here on Thursday in connection with the government`s plan to increase the subsidized fuel prices.
The government and the House of Representatives are currently still discussing the draft 2013 revised budget which would be used as a reference for increasing the fuel price.
He said the rising prices of products as the impact of the oil fuel price hike will not reach more than five percent while the people`s purchasing power is still strong.
He said both the economic life and people`s welfare would even be down graded in the long term if the government would not raise the price and use the budget for paying the subsidy," he said.
"In a long term, the increasing fuel price will be beneficial. The government cannot continually provide fuel subsidy as it will absorb the national budget much," Wanandi said.
He admitted the government should better divert the fuel subsidy budget for infrastructure development to boost economic growth.
"We all know that both sea-port and road traffic is jammed. We have lost our competitiveness," Wanandi said.
He believed improvement in the infrastructure facilities will ultimately improve competitiveness of the country and business will be more efficient as transportation cost will drop.
The infrastructure that should be repaired, according to Wanandi, includes electricity lines, water channels and water irrigation system for farmers.
"The improvement will support people in getting jobs through the increase of oil fuel price," Wanandi added.
A member of the House of Representatives` Commission XI, Achsanul Qosasi, said the government`s plan to raise the oil fuel price is aimed at adjusting excessive subsidy allocation in national budget.
He said the government will not erase subsidy, but its allocation would be directed to a more productive sector.
"The government is seeking to build an ideal national budget. The current subsidy allocation is 20 percent and it is inappropriate for the national budget," Qosasi said.
He said by increasing the oil fuel price the government did not wish to make the people remain poor but it only wished to improve the fiscal conditions.
(B019/H-YH)
Editor: Jafar M Sidik
Copyright © ANTARA 2013
