Face-Off

8226;The BJP and the Left have come out strongly against the petro price rise. Do you think their reaction is justified?

8226; Between May 2004, when the Congress came to power, and May 2008, international price of crude oil has increased approximately 300 per cent whereas this government has taken care to increase Indian petro prices by less than 60 per cent, that is, less than five times the actual international increase. Everyone knows that almost the entire oil consumption of India is imported. Does the government need to be appreciated or berated for minimising the increase?

8226;With a number of elections coming up, do you think the government will be able to defend its move?

8226; People know that in the circumstances, admittedly beyond India8217;s control, more than the best has been done. The Opposition knows there is no free lunch. The Opposition knows that irresponsible economics cannot in the long run be good politics or good governance. None of them is able to give any constructive suggestion.

8226;Not long ago, petrol prices averaged less than 20 a barrel. Now it8217;s above 130. Is there a way India could have been insulated any longer from rising fuel prices?

8226; What could have been an increase of Rs 21 and Rs 31 on petrol and diesel has been kept at a negligible level. This government has managed to distribute the current increase over a wide range of diverse stakeholders to minimise the adverse impact on any one vulnerable group. Thus, the increase has been a minimal Rs 5 and Rs 3.

8226;The Opposition says you ignored their alternative proposals to combat rising oil prices.

8226; The Opposition and others who repeatedly criticise have no solution of their own. It is oversimplistic to suggest that Central government taxes be simply slashed because the lakhs of crores of loss of revenue arising from that will lead to a deficit budget, which, in turn, will hit us all with inflation that is much, much more.

Uma Vishnu

8216;Govt will have to pay a political price8217;

Gurudas Das Gupta CPI

8226;Do you think the petrol price hike is justified?

8226; The hike in the prices of petrol, diesel and LPG announced by the government is unjustified. This assault on the people comes at a time when they are suffering from the steep rise in prices of all commodities. This hike in petroleum prices will further worsen inflation, which the government has failed to tackle. If the government had heeded to the suggestions put forward by the Left parties, this price hike could have been avoided.

8226;With a number of elections coming up, do you think the government will be able to defend its move?

8226; The government will have to pay a political price for this hugely unpopular measure. No government will be able to defend this. What is at stake today is not the market capitalisation of the oil companies but the livelihood of the working people who are already suffering from back-breaking inflation.

8226;How long could India have been insulated from rising prices?

8226; Of course, the price rise is an international phenomenon. But it is the government8217;s duty to take steps to protect the country from international price fluctuations. We have been suggesting a package of measures which would help to meet the steep increase in the international oil prices including cut in import duty from five to zero per cent, reduction in excise duties and on petrol and diesel, setting up of a price stabilisation fund with the oil cess contribution, taxing the windfall profits being made by private oil companies and refineries, and an end to the import parity pricing system.

8226;Is there a long-term solution?

8226; The only sustainable solution lies in restructuring duties on petro products and having a transparent pricing policy whereby oil manufacturing companies and refineries do not retain hefty profit margins. The UPA government cannot pamper private oil companies while public sector oil marketing companies are suffering. The government should impose a 8220;windfall8221; profits tax on private companies and refineries.

Cithara Paul