The centre reportedly wants to continue providing subsidy to consumers for cooking gas and kerosene for five more years. This is not good news from the point of view of reining in the fiscal deficit. Mounting subventions for subsidies means diversion of savings by the government from investment to consumption, raising the cost of capital in the process. The government must cut expenditure on subsidies to create more fiscal space for investments in both physical and social infrastructure. It should outline a plan for comprehensive reform in major subsidies including petroleum, food and fertilizers and set goal posts.
Which of the following is an assumption which is implicit in the facts stated in the above paragraph ?
The passage says that a continuous subsidy program will affect the fiscal deficit, thereby inhibiting the government from investing in infrastructural facilities. Therefore, the arguments assume that there is no other way of investing in infrastructural facilities if the subsidies go on. Hence C is the correct answer.
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