Motorists will gradual rise in prices of diesel and other petroleum products if the petroleum ministry has its way.

The petroleum ministry has proposed a slow and steady increase in prices of diesel, by Rs 1 per litre every month over a period of next ten months.

The ministry also tabled a proposal for an increase in kerosene prices by Rs 10 per litre over a period of next two years.

Oil marketing companies have claimed an under-recovery of more than Rs 30 per litre on kerosene sold through the PDS (public distribution system). The massive price disparity between the market price and price of subsidized kerosene has led to the fuel being sidetracked to taint diesel.

The proposal is being seen as an effort to avoid controversy caused by steep increases in infrequent revisions. Diesel prices were last revised in September this year when they were hiked by Rs 5.63 per litre, causing massive protests across the country.

However, Planning Commission members said that the statement should not be linked to any instant action. Planning Commission member BK Charurvedi said, "That (increase in price) will be decided by the government after reaching a political consensus on the issue."

The government has no option but to cut subsidies arrest soaring fiscal deficit and avoid further downgrades by global rating agencies. The government aims to cut fiscal deficit from 5.3 per cent of gross domestic product (GDP) this fiscal to 4.8 per cent of GDP for the year ending March 31, 2014.