26 March 2012: In a bid to assess the Indian Government’s strategies for reforming fuel subsidies, civil society actors participated in a workshop on “Reforming Energy Subsidies in India,” convened by the The Energy and Resources Institute (TERI) and the International Institute for Sustainable Development’s Global Subsidies Initiative (IISD-GSI).

Participants discussed, inter alia: the impacts of fuel subsidies; options to reform the energy sector; and strategies to achieve these reforms. As the most vulnerable in society depend on the subsidies to make energy more affordable, the International Energy Agency (IEA) reported that the Indian Government spent more than US$22 billion subsidizing fossil-fuels in 2010, $16 billion of which was spent on oil products, keeping energy prices artificially low compared to market prices.

Workshop participants referred to a recently IISD report titled “Citizen’s Guide to Energy Subsidies in India,” which finds that removing, reducing or restructuring energy subsidies may be helpful for the environment and the economy. The report further proposes addressing the attendant social costs by “re-directing the money formerly spent on subsidies to income support, health, environment, education or regional development programmes.”