New Delhi:
In this summer of discontent, it's a partial relief for the aam aadmi. After the steepest hike of Rs 7.54 a litre in the petrol prices last month, state-owned oil companies on Saturday announced a reduction of Rs 1.68 per litre in petrol prices, excluding taxes. In Delhi, after including 20 per cent VAT, the reduction will be Rs 2 a litre.
The reduction, a result of fall in international oil prices, will mean that petrol in Delhi will cost Rs 71.18 per litre, as against Rs 73.18 at present. Petrol price in Mumbai has been cut by Rs 2.12 to Rs 76.45 per litre while in Kolkata it has been reduced from Rs 77.88 to Rs 75.81. In Chennai, the price has been cut by Rs 2.13 to Rs 75.40 a litre.
The decision, flowing out of the fortnightly review by oil marketing companies, came as some relief for consumers battered by double-digit inflation. (Read statement by Indian Oil Corporation)
The decision was expected on May 31 but was then delayed by two days due to the Bharat bandh called by the Opposition. Interestingly, the price of aviation turbine fuel was cut but not petrol.
The May 24 hike had come under sharp attack from all political parties including allies like the Trinamool Congress and the DMK and there was all-round demand for a rollback. Even Congress leaders had said they did not know about the petrol hike and have joined the chorus that the hike be withdrawn. (Read: UPA ally, Opposition reject partial rollback)
The government, however, said that this is not a rollback. "As you are aware that prices of petrol are deregulated, whenever the oil companies are impacting losses, they raise the prices and when the prices of the crude oil go down, they pass on profits to the consumers. I understand that Rs 7.54 hike was a lot, but today the government is not trying to take credit if the prices are coming down because it is not a rollback," Minister of State for Petroleum, RPN Singh told NDTV.
But the Opposition is not convinced. "It is an eyewash, the government is not serious. The prices are still high and we won't accept this," said BJP spokesperson Rajiv Pratap Rudy. The Left too slammed the move. "A cut of Rs 2 per litre in petrol prices is not adequate because the oil companies suggested a steep hike of seven-and-a-half rupees. We demand complete rollback. Oil companies raised the prices when crude prices were coming down so they must be pragmatic. The government's argument is ridiculous that petrol is deregulated. The government is making a mockery of itself and its authority. This partial rollback is not going to help the common man," said CPI leader D Raja.
The decision to partially roll back the petrol prices has evoked mixed response from the aam aadmi. "It's an eyewash. It's a cat and mouse game. We want the government to come out with a clear policy. Leaders are spending so much money on foreign trips, and government should come out with some model which really helps the consumers," said a resident of Delhi.
After the steepest hike in petrol prices last month, a few state governments had announced cut in taxes to ease burden on people. Kerala and Uttarakhand, both Congress-ruled, had announced an immediate cut in VAT on petrol.
India deregulated petrol prices in June 2010 but continues to subsidise kerosene, diesel and cooking gas to protect the poor from the impact of any inflation pressures. In the second half of 2011, oil companies began reflecting market realities more closely and began revising petrol prices.
The reduction, a result of fall in international oil prices, will mean that petrol in Delhi will cost Rs 71.18 per litre, as against Rs 73.18 at present. Petrol price in Mumbai has been cut by Rs 2.12 to Rs 76.45 per litre while in Kolkata it has been reduced from Rs 77.88 to Rs 75.81. In Chennai, the price has been cut by Rs 2.13 to Rs 75.40 a litre.
The decision, flowing out of the fortnightly review by oil marketing companies, came as some relief for consumers battered by double-digit inflation. (Read statement by Indian Oil Corporation)
The decision was expected on May 31 but was then delayed by two days due to the Bharat bandh called by the Opposition. Interestingly, the price of aviation turbine fuel was cut but not petrol.
The May 24 hike had come under sharp attack from all political parties including allies like the Trinamool Congress and the DMK and there was all-round demand for a rollback. Even Congress leaders had said they did not know about the petrol hike and have joined the chorus that the hike be withdrawn. (Read: UPA ally, Opposition reject partial rollback)
The government, however, said that this is not a rollback. "As you are aware that prices of petrol are deregulated, whenever the oil companies are impacting losses, they raise the prices and when the prices of the crude oil go down, they pass on profits to the consumers. I understand that Rs 7.54 hike was a lot, but today the government is not trying to take credit if the prices are coming down because it is not a rollback," Minister of State for Petroleum, RPN Singh told NDTV.
But the Opposition is not convinced. "It is an eyewash, the government is not serious. The prices are still high and we won't accept this," said BJP spokesperson Rajiv Pratap Rudy. The Left too slammed the move. "A cut of Rs 2 per litre in petrol prices is not adequate because the oil companies suggested a steep hike of seven-and-a-half rupees. We demand complete rollback. Oil companies raised the prices when crude prices were coming down so they must be pragmatic. The government's argument is ridiculous that petrol is deregulated. The government is making a mockery of itself and its authority. This partial rollback is not going to help the common man," said CPI leader D Raja.
The decision to partially roll back the petrol prices has evoked mixed response from the aam aadmi. "It's an eyewash. It's a cat and mouse game. We want the government to come out with a clear policy. Leaders are spending so much money on foreign trips, and government should come out with some model which really helps the consumers," said a resident of Delhi.
After the steepest hike in petrol prices last month, a few state governments had announced cut in taxes to ease burden on people. Kerala and Uttarakhand, both Congress-ruled, had announced an immediate cut in VAT on petrol.
India deregulated petrol prices in June 2010 but continues to subsidise kerosene, diesel and cooking gas to protect the poor from the impact of any inflation pressures. In the second half of 2011, oil companies began reflecting market realities more closely and began revising petrol prices.
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