Totally insensitive

Whatever faint hope people had of the rollback of the recent increase in the price of petrol was dashed on Tuesday as prime minister Manomhan Singh told a delegation of Trinamool Congress MPs that the hike was ‘justified.’ The prime minister knew that TC’s threat of withdrawal of support to his government was an empty one and he even hinted at the decontrol of the prices of diesel and the LPG in future.

This shows how unconcerned the UPA government is about the burden borne by the people on account of the frequent hikes in the price of fuel. This was the 13th hike since June 2010, and the cumulative impact of all the successive increases has been severe on the common man. The price has gone up from Rs 52 to above Rs 75 in the last one year, which is almost a 50 per cent increase. The hike coincided with an increase in food inflation which touched a nine-month high of 12.2 per cent and a steady increase in general inflation.

Manmohan Singh’s strong defence of the price hike shows how insensitive he is to the people’s difficulties and how out of touch his government is with the people. Instead of mitigating the pain, the prime minister argued for further deregulation of petroleum prices. All the sane arguments against pursuing a wrongheaded and people-unfriendly policy on petroleum prices have been lost on him. Every time the prices are increased the deleterious impact of the government’s action and the alternatives it has to its one-way course are brought to its attention. But it has persisted with the hikes. Over 50 per cent of the petrol price is accounted for by taxes and a willingness to reduce them would have made the hikes unnecessary.

Neither the Centre nor the state governments have shown the good sense for that. With the increase in petrol price, the use of diesel has become more attractive. Since diesel vehicles are much costlier and can be afforded only by the richer sections of society, the government is actually subsidising their consumption.

The accounting practices of oil marketing companies and their claims of under-recoveries have also been convincingly challenged. It is stated that their operational inefficiency is a major reason for the reported losses. The common people should not be made to pay for their inefficiency and mismanagement. The government should withdraw the latest hike and adopt a rational taxation policy which will make future hikes unnecessary.