The International Monetary Fund (IMF) has said a gradual increase in fuel prices by reducing subsidies will help curb the growth of domestic consumption in Oman, which in turn will strengthen the fiscal position of the government, Times of Oman has reported. “It would be difficult to achieve a sustainable fiscal position without targeting generalised subsidies, particularly on fuel prices, that are disproportionately benefitting the well-off,” Ananthakrishnan Prasad, head of IMF Mission to Oman, told thte daily. The Omani government announced plans last month to cut fuel subsidy in a phased manner. The government’s projected subsidy will touch OR1.61bn in 2014, which is close to 10% of total state expenditure. Of the total, fuel subsidy alone will be around OR860m this year, against OR740m in 2013.
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