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Kuwait getting tough on subsidies

Government agrees in principle to lift subsidies on diesel.

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Kuwait's parliament
Kuwait's parliament

Kuwait has agreed “in principle” to lift subsidies on diesel sold at the pump in what could be a prelude to cutting back on power and water subsidies.

The cabinet decided in its weekly meeting to implement the findings of a special committee into the impact of removing the subsidies, according to state news agency KUNA.

The decision is pending the outcome of a study by the higher planning council into the possible negative effect of removing the subsidies which cost the government around $18bn last year and are rising at over 20% per year.

Removing diesel subsidies would save an estimated $1bn per year, Oil Minister Ali al-Omair said three weeks ago.

Kuwait is also revising subsidies on electricity, water and petrol, currently sold at well below cost.

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