Recovering after crisis, nation’s economy is in for another shock

This could lead to financial crisis

In the recent times, petrol prices have increased internationally and the value of Indian currency has also fallen against dollar further leading to an escalation in petrol, diesel prices in India. Such surge in petrol prices is affecting transportation cost as the cost of goods increases automatically with increase in petrol price. The price hike will affect the common man adversely, who has a fixed income and will worsen the situation due to the ongoing pandemic like punching a hole in the overall budget by not only increasing their spending on fuel but also essential commodities. Cost escalation at wholesale and retail markets, higher spending on travel, medical etc. Since fewer savings will be left with the residents in their pockets, the investments to be made in the economy will also suffer thus leading to the financial crisis in the country. Survival of business, unemployment is a big challenge due to the pandemic.

Suneet Kochhar

What kind of governance is this?

The rapidly increasing prices have broken the backbone of the common man. It has extremely become difficult to sustain livelihood in such a precarious situation for residents of all hues. The petrol and diesel prices have almost touched Rs100 per litre. LPG cylinder refill costs Rs820 with a negligible subsidy of Rs31. One kg mustard cooking oil is being sold at Rs150. Likewise, prices of all essential commodities, including medicines have sky-rocketed. The oil and gas companies and traders are looting the people in broad daylight with the tacit support of the Union Government which promised ‘achhe din’. The other day the Finance Minister Sitharaman said oil companies are responsible for the recent hikes and the government has no control over it. If that is the case why does the government levy heavy taxes on these items? Similarly, the PM held Congress responsible for the hike, conveniently passing the buck to the dispensation which was in power seven years ago. Thus, the government has unabashedly washed its hands of the burning issue forgetting that people cannot be befooled all the time. Inflation on all essential items has turned people’s plight from bad to worse. The fixed income groups like the salaried class, labour class and pensioners are the worst hit. To add to it, the Union government has frozen the employees and pensioners’ DA up to July 2021. It is spending money on all minor and major works but is not inclined to release the DA. It is by no yardstick good governance as masses have been completely ignored. Its policy of privatising public entities has become a bane rather than a boon for the teeming millions who lost their jobs or had their salaries stopped or slashed following the Covid lockdown and the resultant economic crisis. One wonders why the government is bent upon backing the wrong horse. The spiraling prices have triggered a cascading effect on businesses spread across various sectors, ultimately impacting the hapless residents. The economy recovering from the Covid-induced crisis is going to be impacted devastatingly besides breeding discontent among the masses. Hence, the taxation policy ought to be drastically improved and made more rational pragmatically.

Tarsem S Bumrah

A shocker for the common man

Due to the pandemic India’s economy is in doldrums. The GDP has reached its lowest position while inflation is crowning. In this scenario, rising prices of LPG cylinder, petrol and diesel substantially by the government has made life very difficult for residents. Many residents have already lost their jobs, while others have faced salary cuts or have suffered huge losses in their businesses and overall earning capacity of each resident whether service man/woman or businessman has been affected. In this scenario, shooting up of gas prices by the government has proved to be a rude shock to the residents. The middle class service man was having hand to mouth earnings amid pandemic but this development has made them panicky as they are left with no option other than to cut their daily desires of essential commodities to sustain livelihood. Life has become difficult for every resident as they have started sacrificing their desires to sustain livelihood. Due to hike in petrol, parents have stopped taking out their little kids for a ride on their vehicles. Rising diesel prices have further anguished farmers to a great extent as they are already protesting against central government for making new agricultural laws.

Sanjay Chawla

Behold the immorality of our policymakers

Prices of LPG cylinder touched more than Rs728, petrol’s crossed Rs93 and diesel’s crossed Rs83 mark. Thus, rise in fuel price has started pinching the common man. The rise in natural resources has a cascading effect all over the economy but if there is a downward revision in prices, we hardly witness a corresponding price adjustment by supplier and service provider. The government know that demand of natural resources is inelastic to its price change and people will continue to purchase it but its hike like sky-rocketing shows the immorality of our policymakers given the fact that tax incidence is to be borne by ultimate consumers whose livelihood are impacted due to Covid. PSUs data reveals an annual profit of about $10 billion since 2016-17 in oil public sector undertaking. Some social media posts reveal that price hike of natural resources are due to repayment of loans by NDA government, due to depreciation of INR, tax rate reduction given to corporate houses, abolition of divided distribution tax (DDT), interest on the provident fund of middle class savings shows policymakers are least concerned about pain and gains of middle class. Sky-rocketing hike will have an impact on many business spread across various sectors like automobile industry where large number of employment in the country lowers demand will lead to job losses and also impact increasing of operational costs of various logistics directly proportional to meet the physiological needs of an ordinary human being.

Ankur Gupta

Some relaxation in the prices needed

Today when the pandemic has hit most with job losses and medical expenses, survival for a middle class man has stretched his budget with so much elasticity that it can snap any moment. The lower class, the rural womenfolk could barely manage to buy a gas cylinder also using dry wood for kitchen use picked up from wherever available, they are the worst hit and especially the villager who has a two-wheeler for commuting to work, dropping and picking up children to and from school and the farmer making his life easy to cultivate his lands using tractors and farm equipment instead of the old method of tilling lands. The steep rise in prices of natural gasses has broken the backbone of ordinary user and there is no respite during these tough times from the government who is insensitive to the needs of the consumer. If the government wants it can ease the hike but the will is lacking. All in all, except the ‘richie rich’ rest are badly affected by this and has thrown life out of gear. At this crucial phase, a little relaxation in the price hike would be a welcome step!

Indu Aurora

High prices lower people’s spirits

Sharp increase in the prices of crude oil has a widespread impact on citizens and the overall economy. Initial impact will be felt by people who own personal vehicles. It is agreed that the rise will dent their savings by adding to monthly budget as well. More, rising fuel prices will lead to a sharp dip in vehicles’ sales and the lower demand will have a major impact on the automotive industry leading to widespread job losses in the sector. The high prices are going to have higher impact on business spread across various sectors, including public transportation. It will be seeking high fee in rates for passengers in view of rising operational costs. A hike in rates is ultimately a great trouble for citizens. The increase in online purchasing products delivery rates has already affected people. All in all, India’s economy is expected to witness a delay in recovering as pandemic has greatly affected people financially.

Khushpreet Kaur Brar

Go for domestically sourced LPG

Currently, the price of LPG gas cylinder is determined in India on the basis of cost of import with addition of domestic transportation and handling charges and commission to the agents. This method of cost calculation is ignoring the fact that roughly half of the total consumption of LPG gas cylinders in India is sourced from domestic (in India) production. The domestically sourced LPG gas is cheaper than imported one. Therefore, the price of LPG gas cylinder for domestic use should be based on average of total cost that is cost of import and cost of domestic production, which would result in substantial reduction in price for the Indian citizens. Moreover, it would also control fluctuation in the prices due to international influences.

Avnish Khosla

Govt has failed to revive economy

The sky-rocketing prices of LPG and petrol products have put an additional burden on the general public. On one hand, in midst of the pandemic, small business firms are on the verge of extinction, making it difficult for people to make ends meet. In such a scenario, the government should think for the public to fix the price of daily necessities at a normal rate so that it is not beyond the reach of the common man. It is a clear sign that the government has failed to manage the economy and is now imposing an unnecessary burden on the general public which is reprehensible. The people now need a new government that works for the benefit and welfare of the common man. Today, everyone wants change so that people do not fall prey to inflation and debt for their basic needs. People should get household goods at a controlled rate and not subsidies because if people cannot meet their living expenses with their hard-earned money then it shows wrong policies of the government. If inflation continues to rise like this then it will be out of reach of the common man to survive, which is a disgrace to the present rulers whether it is the Centre or state government.

Damanjeet Singh

Govt must cut taxes on petro products

Ever-increasing prices of LPG, petrol and diesel are everyone’s concern. The excise duty and GST of Union and state governments are mainly responsible. To sustain in the Covid-19 era, the governments must reduce taxes on petroleum products and people to judicially use these products.

TS Bhatti

Our government lacks gumption

In our country all virtuous qualities fall in the category of theory whereas all vices are put in practice. In support, the most illustrative example is of ‘nari puja’ on one end and rape cases of minors on the other end. Like any science subject, this theory and practical approach is applicable to all government policies. In theory, petroleum products were decontrolled in phases since long, ATF in 2002, petrol in 2010 and diesel in 2014 which clearly means that retail prices of all such products are linked with the prevailing international crude oil price. But this is the theory part of it, in practice it is not so. In practice, when during pandemic international crude prices fell drastically our central government slapped fresh taxes and levies to earn more profits. Before the lockdown was declared, both central and state governments were collecting 107% taxes (excise duty and VAT) on the basic price of petrol and 69 per cent on diesel. But after the fall in rates of crude oil government did the first revision of rates on 16th March last year by increasing the said rates 134% on petrol and 88% on diesel. Thereafter, with the further fall in the rate of international crude prices a second upward revision followed in May 2020, with 260% increase in petrol and 256$ increase in diesel prices. A government formed for the benefit and welfare of the public can exploit the miserable conditions of the people during the pandemic, how you can stop the private health sector from taking advantage of the situation created by pandemic? But in spite of all this, we are running the business as usual. There is no protest from ‘sadak ‘ to ‘sansad’.

Harsh N Johar

Govt must compensate for the hike

The pandemic has already taken its toll. Not only physically or mentally but also financially; it is much bigger. When people have lost their jobs or are working for lower salaries due to pandemic, increasing prices of LPG and petrol will hugely impact them. It surely upsets the tight budget of lower middle class and poor families. Upper middle class and rich families may show concern to increasing prices but their budget is bigger enough to absorb all this. People who earn a few thousands a month, extra spending is unmanageable. And increasing petrol prices indirectly raise price of every commodity due to rising transportation prices. Crude oil prices may have risen but to mitigate the sufferings of a common man government has to step in. Either State or Centre should reduce taxes on petrol and LPG.

Dr Naresh Chawla

The prices are going to shape more blues

The frequency with which petroleum and gas prices have been rising, with the current (as on 25th February) litre of petrol touching Rs100 and a cylinder of Indane Gas costing more than Rs850 reminds me of the UPA period during which the BJP led all breast-beaters when the price of a gas cylinder was hiked to Rs400, less than half of today’s. And even this will likely not be the last push up. I wonder why the BJP members, supporters and leaders are sitting as mute observers because they too cook their meals with the same fuel. Imagine the plight of their voters who live below the destitution line. The irony is that even when the international price of petroleum falls, the relief is never passed on to the consumers. The latest hike in petrol prices will soon show up in the shape of increased tariffs on road/rail transport and certain increase in overall prices. Where should one seek relief – the long awaited ‘achhe din’, one is reminded of Mirza Ghalib couplet “tere vaade par jeehe hum, to yeh jaan jhoot jaana, ke khushi se mar na jaate agar eitbaar hota (you misunderstood me dear, if you thought we believed you, for would we not have died in glee if you could be trusted?

Mohan Singh

Rubbing salt into the pandemic wounds

The lockdown due to the pandemic affected the earnings of people, especially those engaged in the private sector. Now, the increasing prices of petrol, diesel and LPG cylinders are adding salt to the wounds of people. Both the central government and state governments levy exorbitant tax rates on petrol and diesel despite the global crude oil prices being very low. Many cases of suicides are being witnessed due to poor financial conditions of their families. The governments should help the people as it is the most important duty that is bestowed upon them.

Jatinderpal Singh Batth

Middle class at the receiving end

Petroleum products are essential commodities. Nowadays, every household needs gas for cooking food. I remember the times a gas cylinder of 16 kg used to cost about Rs32. Now it costs Rs800. It has upset the budget of a normal housewife. With the increase in gas prices, a larger amount is spent on preparing the food as a result of which other areas such as education of children, clothing, travel suffers. It is niggling as cities have become larger and one has to travel a lot for various reasons and purposes. Institutions of a variety of kinds, such as universities, IIMs, IITs, AIIMS, etc often are situated far from residential areas. Children, teachers, and administrators will have to reach there either by public transport or on their own. In either case, it will cost more with the rising cost of petrol or diesel. The middle class has been continuously and continually ignored by the successive governments because of being small in number (only 4%) hence not a vote bank.

AK Joshi

Corporate houses pulling the strings

Recent hike in the price of LPG cylinder is back-breaking for a common household budget. The retail price was sublimated Rs50 just before a week. The total increase in retail price of LPG cylinder within three months is net Rs200. Similar is the case of hefty prices of petrol and diesel, increasing on daily basis. The uncontrolled increase in retail prices of the petroleum products will make all products of daily use much costly. This trend has caused unbearable increase in the input costs of agriculture. The general public is already facing financial hardships as most of the people have lost their jobs due to the lockdown imposed because of Covid-19. The labour class, who are dependent on their daily earnings, has been hit hard. Instead of providing them a helping hand on the pattern of countries like Canada, the government has turned a blind eye towards their livelihood and financial problems.

Kulwant Singh Ankhi

Now, people should spend smartly

People are extremely disappointed with the government seeing the high prices of petrol, diesel and LPG cylinders. In such a situation, people should spend money very smartly. For instance, they should prefer public transport instead of taking their own. This move will help them save some money as well as environment too. The government is not in the mood to reduce the prices of petrol and diesel.

Saahil Hans

QUESTION

In view of the increasing Covid cases in Punjab, what measures should the government take to prevent a second surge in the state?

Suggestions in not more than 200 words can be sent to amritsardesk@tribunemail.com by Thursday (March 4).