KOTA BAHARU, Sept 7 — The government has taken the right move to reduce subsidies for petrol and diesel to strengthen the economy in the long term and avoid negative effects from their continuation.

Minister of International Trade and Industry, Datuk Seri Mustapa Mohamed (picture), said the rakyat needed to understand that the continuation of the subsidies will bankrupt the nation and they have to bear the consequences.

“The RM23 billion fuel subsidy is a big sum and no nation can bear the burden forever. Thus we need the rationalisation programme which will undertake the reduction gradually.

“Currently, the government still subsidies eight per cent per litre.

“Thailand has no subsidy and we should be grateful now,” he told reporters after launching a health campaign here today. Mustapa said when asked to comment on the 20-sen increase for RON95 petrol and diesel and 15 sen for RON97 petrol.

He said the government increased the prices gradually because it understood the plight of the rakyat and hoped that no one would take the opportunity to capitalise on the situation.

“This is an important move to protect the future of the country. We can take a populist action but it will bankrupt the nation.

“We do not want the country to face a bigger problem as we want to ensure a stable and strong economy in the long run,” he said.

On why the government did not withdraw the subsidies given to independent power producers, he said the move would result in an increase in electricity tariff and this would affect businesses and would result in a bigger problem. — Bernama