 They create vested interests and acquire political hues.In addition, it is difficult to control the incidence of a subsidy since their effects are transmitted through the mechanism of the market, which often has imperfections other than those addressed by the subsidy.On 29 June 2012, C Rangarajan, Chairman of the Prime Minister's Advisory Council in view of present difficult economic position, advocated cutting down of fuel and fertiliser subsidies to keep the fiscal deficit within the budgetted level of 5.1 per cent.