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Govt hikes diesel price by Rs 5; puts cap on
number of gas cylinders
Huge blow to common man,
says Opp; Trinamool decides to hit streets against the move
Friday September 14, 2012 10:05:04 AM,
IANS
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New Delhi: In a
politically-sensitive move, the government Thursday announced a
hike in heavily-subsidised diesel price by Rs.5 a litre to check
fiscal deficit and limited availability of cooking gas cylinders
per family to six per year. The hikes come into effect midnight
Thursday.
The Cabinet Committee on Political Affairs (CCPA), chaired by
Prime Minister Manmohan Singh, took the decision, which has been
decried by a combative opposition and even allies as
"anti-people".
UPA's second-largest constituent, Trinamool Congress, demanded a
rollback, with party chief Mamata Banerjee saying she would have
been very happy if she could have withdrawn support from the
regime rather than be party to such "anti-people" policy.
The steep hike in diesel prices is expected to affect a wide gamut
of transportation ranging from locomotives to heavy duty trucks.
The government cited financial compulsions to justify the
controversial price hike, which could fuel inflation and burden
the common man who is already reeling from spiralling prices of
basic commodities.
The government however said diesel and cooking fuel prices have
not been revised since June 2011.
Citing rising global crude oil prices and devaluation of rupee,
Petroleum Minister S. Jaipal Reddy had said Wednesday that a hike
in diesel, LPG and kerosene prices was "unavoidable" despite the
"painful and difficult" nature of such an increase.
State-owned oil firms are losing around Rs.550 crore per day on
the sale of regulated diesel and cooking fuels and around Rs.16
crore per day on petrol.
Oil Marketing Companies (OMCS) have been selling diesel at a loss
of Rs.19.26 per litre, kerosene at a loss of Rs.34.34 per litre
and domestic LPG for a loss of Rs.347 per 14.2 kg cylinder.
The Congress defended the government's decision to hike the price
of diesel.
Party general secretary Digvijay Singh said that the party was
"solidly" behind Prime Minister Manmohan Singh and his government
on this decision. "... sometimes, a good government may have to
take unpleasant decisions too," he said.
The Bharatiya Janata Party (BJP) slammed the hike, saying it would
have "cascading effect" of cost of essential commodities,
resulting in further inflation and price hike.
"We strongly oppose and condemn the hike in diesel prices. The
government has put diesel in the fire that is raging in the
country because of coal allocation scam," BJP leader Ananth Kumar
told reporters. "The hike will hit common man, farmers and
workers."
Ananth Kumar said the cap put on the number of cylinders was also
highly condemnable.
The government later clarified that people can buy any number of
cooking gas cylinders at the market rate over the capped number of
six. While the price of subsidised cylinder will continue to be Rs.
399 per cylinder in Delhi, the market rate will be notified by oil
firms monthly.
Communist Party of India-Marxist (CPI-M) leader Brinda Karat said
the hike would only "further burden the people's pocket" and
slammed the government's claim that the oil companies had poor
recoveries.
Communist Party of India's (CPI) D.Raja said his party "strongly
condemned" the decision and called it a "huge blow" to the poor.
Attacking the UPA government, he said it had "failed to control
the prices and inflation" and the decision was "unjustified".
"I only hope the people come out on to the streets against the
government and its decision," he added.
The opposition's denunciation found support from Trinamool
Congress. Banerjee announced that her party will hit the streets
against the anti-people decision, and threatened it wouldn't "take
her a minute to withdraw support" if the hike was not reversed.
"We oppose such anti-people policy. I am shocked and disappointed.
They have made a coordination committee but they don't bother to
discuss with the allies. I request the common people to take part
in the rally," said Banerjee, also the West Bengal chief minister.
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