Photographs: Parth Sanyal/Reuters.
D Raja
CPI, Member of Parliament
The government has not made any sincere attempt at accelerating the exploration of oil and natural gas in the country to augment domestic supply to control the price rise.
The Union government has become insensitive towards rising prices and rampant corruption in the country and the people will teach it a lesson when the next general elections come around.
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Should diesel prices be hiked?
Image: Gudia, an oil scavenger, collects engine oil at an auto workshop in Jammu.Photographs: Amit Gupta/Reuters.
There have been several such increases since the United Progressive Alliance government came to power.
The recent price rise would also have a cascading effect on the common people because increasing the prices of petrol and diesel would impact the prices of food and other essential commodities. In the past six months, the price of petrol has gone up by Rs 8.41....
Should diesel prices be hiked?
Image: Activists from Bharatiya Janata Party (BJP) use a horse to pull their car during a protest rally.Photographs: Ajay Verma/Reuters.
If prices continue to rise in the same manner, how will the common people in this country pay for essentials? Latest reports show that 77 per cent of the people earn barely Rs 20 or less per day.
How will they buy food items if prices continue to rise? Poverty is a big problem in India and half the population is not even earning half-a-dollar a day. To make things worse for them, the government is not even considering raising minimum wages. I want to know how people will buy vegetables and other essential food items with the same income. The government must explain this....
Should diesel prices be hiked?
Image: An employee fills petrol at a pump in Kolkata..Photographs: Jayanta Shaw/Reuters.
I don't remember a day when the oil companies actually reduced the prices of petrol and diesel. It seems the autonomy was given only to the oil companies to raise prices and burden the people. The government is not clear about what it is doing by increasing these prices.
Oil producers might argue that the price rise is a function of demand and supply. But it is also true that the government has not made any sincere attempt at accelerating the exploration of oil and natural gas in the country to augment domestic supply.
It has not made serious efforts to carry out exploration work near Bombay High and Krishna Basin to find new reserves of oil and natural gas within the country to control the oil price rise.
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Should diesel prices be hiked?
Image: An employee fills up containers with petrol at a pump station.Photographs: Jayanta Shaw/Reuters.
Earlier, the government was talking about Iran-Pakistan-India (IPI) pipeline and now, it has suddenly started discussing a Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline.
If the IPI pipeline is not feasible how can the government even consider TAPI viable? The government doesn't consider discussing these issues either inside or outside Parliament....
Should diesel prices be hiked?
Image: School children watch a train transporting petrol in Jammu.Photographs: Amit Gupta/Reuters.
It has become the mindset of this government to generate revenue by increasing prices of petrol and diesel. The government should generate revenue for exploration and to augment resources but it should not be done at the cost of the common people.
(As told to Gyan Verma)
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Should diesel prices be hiked?
Image: A worker arranges cooking gas cylinders in a truck outside a shop in Mumbai.Photographs: Punit Paranjpe/Reuters.
The deregulation of diesel has the potential to unlock the value of the oil firms. Today subsidies affect both oil marketing companies and upstream companies.
It is normally assumed that regulation is beneficial and the only prudent approach in a nation as complex as it is poor is to have a policy that benefits the underprivileged. But some regulations are often rendered obsolete owing to dynamic shifts in the business.
And soon, the realities of the market start impinging on even the best of good intentions! Diesel has long been seen as a sensitive fuel along with kerosene and LPG.
It was thought that kerosene and LPG impacted the aam aadmi and the price of diesel was linked to inflation. It is correct that diesel prices have an implication for the economy with the "trickle down" effect on the freight and goods sector.
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Should diesel prices be hiked?
Image: A woman carries a cooking gas cylinder as men pull a string tied to a motorbike during a protest.Photographs: Amit Dave/Reuters.
You only have to look at the number of diesel passenger cars and sports utility vehicles (SUVs) being sold, especially in the luxury segment.
The question is: are we subsidising an SUV culture? Should the relatively low-income earning two-wheeler owner pay for free-market petrol while owners of high-end luxury cars and SUVs get a subsidy from the government?
We need a mass rapid transit infrastructure policy under which the transportation of people and goods should not depend on roads alone. The potential of the railways should be fully tapped.
The diesel subsidies can actually be invested in big-ticket mass transportation systems that will wean people off the addiction to diesel-based transport.
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Should diesel prices be hiked?
Image: A petrol kiosk worker puts up a sign at a pump in Chandigarh.Photographs: Ajay Verma/Reuters.
The central government has already rationalised customs and excise duties to alleviate the impact of volatile international prices on retail selling prices.
But the state governments have chosen to keep the sales tax at fairly high rates in view of the revenue-earning potential of diesel. This apart, private oil companies have closed their retail outlets despite making quite a lot of investment in them, a move that has meant a shift in sales to public sector oil marketing companies' outlets, which has resulted in an additional burden. Investments made by the private sector in the hydrocarbon value chain, especially the retail network, have been rendered useless. Deregulating diesel has the potential to unlock the value of the oil companies. Today subsidies affect both oil marketing companies and upstream companies. Valuable resources being spent by the government could actually go into ensuring oil security. Today, we have excellent examples of companies that have been rewarded by investors who are even willing to pay a premium.Ultimately, the beneficiary is the nation because these companies are owned by the people of India.
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Should diesel prices be hiked?
Image: A bullock cart transports kerosene.Photographs: Arko Datta/Reuters.
The way forward for India is for our national oil companies to get into the act to build a truly international portfolio of oil and gas assets.
Should diesel prices be hiked?
Image: Diesel prices to rise.Photographs: Reuters.
But, investing for the future should obviously come from the present. And by paying the right price for energy products and services we generate the revenues for investing for the next generation.
Beyond urban India, which has benefited from the rapid growth of the last decade, is the real India, where there are millions of our people struggling to make ends meet.
When the oil marketing companies moved to the rural market, opening up retail outlets and appointing LPG distributors, we so a tremendous difference to livelihoods. All this will take long-term, sustained investments for the real "aam aadmi".
And the sooner we define the "real aam aadmi" the better, for we need to tackle the real and imperative task of delivering energy assurance to over a billion Indians into the next decades as well.
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