'Rise in essential, petro-products vexed issues facing India'

It is not possible for the Centre to decrease the price of petro-products because huge subsidies are already being given to the oil companies for sale of fuel at controlled rates, Mukherjee told a Congress seminar here.

Crude is being imported at a price many times more than at the time of the Budget, Mukherjee said.

He said foreign oil firms were also increasing the prices of petro-products.

State governments, he said, can not continue to rely on loans from the Centre and have to increase their own sources of revenue to tackle the situation.

Mukherjee said that in West Bengal, the Trinamool Congress-Congress government was facing a financial crisis because the earlier Left Front regime had failed to generate revenue over 34 years of rule inspite of being told repeatedly to do so.

He said he had earlier told the Left that calling bandhs when prices went up was no solution.

Suggesting a way to tackle inflation in essential commodities, he said the PDS system should be strengthened.

A strong PDS system will benefit 40 crore people and help arrest the price spiral, he said.

Replying to a question on why Jute Corporation of India Ltd was not purchasing jute from growers, he said he would inquire into the matter after returning to Delhi.

Virtually echoing West Bengal Chief Minister Mamata Banerjee who has blamed the previous government for the financial crisis in the state, Mukherjee said the present state government inherited a massive debt burden of Rs 2.3 lakh crore from the earlier government.

"The debt burden in West Bengal is highest among the 28 states," Mukherjee said.
"I used to tell the previous government to raise income generation when the per capita income in the country was rising."

Stating that the tax-state gross domestic product ratio in West Bengal at 4.1 per cent was lowest in the country, he said that it was 9 per cent in Gujarat and 8.75 per cent in Karnataka.

He said he could not convince the erstwhile Left Front government the difference between borrowings and revenue generation. "I used to say this even when Jyoti Basu was the chief minister and Ashok Mitra the finance minister."