In the midst of uproar over hike in petrol prices, Rural Development Minister Jairam Ramesh on Friday attacked the policy of subsidising diesel, kerosene and LPG and suggested that a roadmap be chalked out for phasing it out as the needy are not benefited.

"In our country if we combine diesel, Kerosene and LPG, Rs 1,90,000 crore is the amount of subsidy given. The budget of the entire Rural Development and Drinking Water ministries in comparison is Rs 99,000 crore," Ramesh told reporters here.

"What kind of country is this? For development of rural areas Rs 99,000 crore and such heavy subsidy for diesel SUVs. For defence we spend Rs 1,00,080 crore but give much more as subsidy," he added.

Ramesh, while responding to a question on Rs 7.5 hike in petrol price, said taxes had to be imposed on sale of petrol so that development work could be carried out in the country.

"Where does the tax go? Where does the money come for NREGA? Where does the money come for Prime Minister's Gramin Sadak Yojana? It comes from tax," he said.

At the same time, he said, subsidy should only be given to those families which are poor and for whom it is important.

He added that there were many in the country who were getting subsidy benefits without really needing them.

"There are many lower and middle income families which use LPG, but there are many rich, including myself who get subsidy on LPG cylinders despite not needing it. There is a subsidy of Rs 503 on every LPG cylinder," Ramesh said.

"I don't say that subsidies should be immediately scrapped. No Government is that insensitive. But a roadmap for the next two three years should be formed, because in such conditions economic development is not possible," he said.

Ramesh also said that 20 per cent of the diesel sold in the country was used for running SUVs while 40 per cent kerosene was adulterated.