THE central government and the oil marketing companies are into a game of their own. Fuel prices are steadily being increased in recent days, with the hikes totalling about Rs10 while more raises are only to be expected. While it is understandable that the Iran War has its impact on global crude prices, it would look appear as if the Government and the oil companies are turning this adversity into an opportunity to sharply raise fuel prices. Raising the prices in one go would have invited strong protests. But the repeated small raises have become a huge burden on the common man. Clearly, Prime Minister Narendra Modi created the necessary conditions for this by magnifying the adversity through a call to the people to reduce travel etc.
Raising fuel prices is an invitation to larger problems in the form of a massive rise in the price of essential goods for daily use as also of materials for construction etc., on the pretext that their transportation costs have spiralled. This is happening across the board for no good reason. Traders are game raising prices on their own as they have sufficient excuses in the form of a governmental warning to the people vis-a-vis the consequences of a war that was fought elsewhere. The resultant inflationary pressure is having serious consequences on the national economy and on people’s lives. Government employees could remain unaffected by inflationary trends as they get matching periodic raises in their pay packets. The common man’s struggle, it would appear, is not the governments’ concern. Finance Minister, Nirmala Sitharaman’s invocation of a “loss of Rs.1 lakh crore to the exchequer due to the cuts in excise duty on fuel” is only one part of the big story. She hides the other part.
What should not go unnoticed in this context is the fact that the central government had not reduced the prices of diesel and petrol, other than a negligible amount of one or two rupees, for the past several years even as global crude prices fell by half since 2014. Apparently, the Modi Government took a heavy cut from the profits thereof for all these years to majorly swell the national exchequer. While the people were taken for a sweet ride, the national economy remained in robust mood thanks to these huge earnings to the national coffers. Perhaps the only reason for the feel-good economic growth story was this, coupled with the huge earnings from the implementation of the GST. This helped Prime Minister Narendra Modi to run the government in an effortless manner, while the economies of neighbouring Pakistan, Sri Lanka and Nepal nosedived, resulting in anti-government protests. Be that as it may, the central government is now duty-bound to plough back a share of what it unduly earned from the oil marketing segment, and allow the oil prices to stabilize irrespective of the global headwinds. At a time when people are struggling to cope with the abrupt rise in prices of essentials and other commodities, the government come to their help and avoid creating conditions for a further uncontrolled rise in prices across the board.
