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Fleecing through fuel prices

Fleecing through fuel prices

The country's fuel prices that keeps rising on a daily basis has come to a stage of further hurting the common man. Needless to say , petrol and diesel prices which are breaking all records, affect consumer states like Kerala the worst. Compounding the burden is the withdrawal of subsidy in cooking gas. With the country still in the grip of the Covid pandemic, and when the consequent sufferings continue, fuel the top component of essential goods, has become the favourite item the Modi government uses to fatten government's coffers. Ever since the right to fix fuel prices was passed completely to the public sector and private sector companies, this exploitation has been going on unchallenged without any scrutiny or reconsideration. The government has been riding roughshod over the people's groans. The other day petroleum product prices beat the peak levels that prevailed in September 2018. Since Monday, petrol has been selling at Rs 85.72 per litre and diesel at 79.65 in Thiruvananthapuram. In Delhi, Mumbai and Bhopal petrol price went above Rs 90 per litre and diesel price rose to Rs 80.10 per litre. This raises not only the transport cost of the rich and common people alike, but through its fallout of rise in freight costs also implies a price hike on all essential commodities including food. The one factor to which the government and oil companies attribute all this is the rise in crude oil price in international market.

When in 2011 the per barrel price of crude was USD 112, petrol in Delhi was selling at Rs 63.37 per litre, and diesel 41.12. But subsequently, even when in 2015-16 the average crude price nosedived to USD 46 per barrel, petrol-diesel prices in the country went north. Whereas crude oil price has been falling since 2014 as much as 73 percent over the previous price, the Indian consumer has been forced to pay nearly the same per litre price due to the heavy tax imposed on it. Now India has become the country with the highest price of petroleum products. According to a study report, since Modi government took office, petrol price has risen 142 percent and diesel 429 per cent. During this period the levies were jacked up 11 times, and were reduced only twice. The part played by states in price rise is not small, with the state governments continuing to impose VAT and other levies on the people. It has to be noted that neighbouring countries such as Pakistan and Sri Lanka, who face economic crisis at the same scale as, or higher scale than India, are selling petroleum products at prices below India's.

Given that even people in rural areas rely on cooking gas rather than firewood, it hurts more when the Centre withdraws the subsidy on LPG cylinder. Prior to this, over one and a half crore people with taxable income over Rs 10 lakh are not entitled to subsidy; and the rest will receive subsidy on only 12 cylinders per year. With this too suspended, the Modi government has netted a clear Rs 20,000 crore into the treasury. The reason given for withdrawal of subsidy is the fall in LPG price thanks to the drop in crude price in world markets. The government had allocated Rs 37,256.21 crore for cooking gas subsidy. But during the first quarter from April to June, the government has had to spend a mere Rs 1,900 crore.

Only a review of how the revenue so derived lakhs of crores of rupees – in fact through squeezing and fleecing the people – is spent will bring to light the appalling picture of the lopsided priorities of the government. Even when an extensive parliament house facility exists, the Modi government is going ahead with a project for a new parliament complex at a cost or Rs 20,000 crore. Although the Supreme Court has put a temporary halt to its construction, it has allowed the foundation stone laying to proceed as planned. The Ahmedabad-Mumbai high speed railway, costing billions of rupees, is going to be a reality, but also projected to be a white elephant. Despite warnings that the project will not only not make profits, but will even run into huge loss, the Gujarat-leaning nostalgia of the Modi-Amit Shah team is such that such warnings have not deterred them. When anti-people spending of this sort continues, the only option before the people will be that of firm resistance in the model of the farmer protests.

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TAGS:Fuel price hike international crude price subsidy cooking gas 
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