India's oil subsidy structure needs serious policy rethink - Fitch.

(From AFX Europe (Focus))

MUMBAI (Thomson Financial) - Fitch Ratings said India's current oil subsidy policy -- aimed at insulating consumers from the twin hits dealt by galloping world crude prices and an energy-hungry economy -- by increasing the burden borne by downstream public sector companies and the government, is fast becoming unsustainable.

The ratings agency cited the broader issues of liquidity and financial health of the oil companies, the fiscal position of the government, as well as the country's energy security, and said that the need for a more far-sighted energy pricing and subsidy policy will not be obviated even if oil prices decline in the …