oppn parties Tame The Oil Price Demon Fast

News Snippets

  • In reply to a question in Parliament, the government says it is empowered to lawfully intercept, monitor or decrpyt information stored in a computer resource in the interest of sovereignty or integrity of India
  • Police stop a 12-year old girl on her way to the Sabarimala shrine
  • In Karnataka, the JD(S) indicates that it might support the BJP government if it falls short of numbers after the bypolls
  • Congress pips the BJP in local body elections in Rajasthan, winning 961 wards to the BJPs 737
  • After Airtel and Vodafone-Idea, Jio also indicates that tariffs will be raised from December
  • Sources in Shiv Sena say that they might revive the alliance with the BJP if it offers the 50:50 deal
  • A miffed Sanjay Rout of the Shiv Sena says that it will take "100 births" to understand Sharad Pawar
  • Mobile operators Vodafone-Idea and Airtel decide to raise tariffs from next month
  • Sharad Pawar meets Sonia Gandhi and says more time needed for government formation in Maharashtra
  • Justice S A Bobde sworn in as the 47th Chief Justice of India
  • Supreme Court holds hotels liable for theft of vehicle from their parking area if parked by valet, says "owner's risk" clause is not a shield from such liability
  • Finance Minister says she is receiving feedback from many sectors that recovery is happening as there is lower stress
  • Sabarimala temple opens, but police bar the entry of women below 50 years
  • Finance Minister Nirmala Sitharaman says Air India and BPCL to be sold off by March
  • Media person Rajat Sharma resigns as DDCA president
Two Muslim litigants in Ayodhya refuse to accept the Supreme Court order, say review petition might be filed
oppn parties
Tame The Oil Price Demon Fast

By Ashwini Agarwal

The spiraling price of petrol and diesel has left the government worried and the public angry while providing ammunition to the opposition to fire more salvos at the NDA government. It is definitely a matter of concern that prices of fuel have been raised everyday for the last 10 days in the free pricing regime. The oil companies have no alternative as they have a set formula and if price increases in the global market, it is reflected in India. But the government definitely has many alternatives.

Since the price has increased nearly Rs 10 per litre from the level it was till as recently as September 2017, the time has come to take a hard look at the duties and taxes imposed on crude and petroleum products. For the last couple of days, the government is saying that it is holding meetings to work out formulas to ease the pain both in the short term and a more permanent solution for future. But it has to hurry and come out with a solution sooner rather than later. In doing so, it should not take the regressive step of controlled pricing.

It has to cut import levies, as suggested by private players and it has to reduce excise duty. It has also got to impress upon the state government to reduce VAT. Finally, it has also got to tell the oil companies to reduce their profit levels, say by just half a percentage point. For, with OPEC and other oil producers showing no inclination to work towards a stable price regime, oil prices are likely to balloon to $ 85-90 per barrel (from $ 79.5 now) in the next 6-12 months. The government must employ a set formula that will offset increase in global prices by corresponding, and automatic, cut in import duty and excise. Any further increase in price of petrol and diesel will bring about spiraling inflation and strife. Already, unions of bus and truck operators have given notice of a strike if prices continue to rise.