New Delhi: Petrol prices have hit an all time high at Rs 65 a litre. The government says it has no hand in petrol pricing and that the pricing is linked to crude prices. Yet it waited for the Assembly election results to announce the hike.
The Opposition took to the streets on Monday demanding an immediate rollback.
It's the steepest and the 8th petrol price hike since it was deregulated in June last year.
Back then prices were just around Rs 51 per litre. In Delhi, petrol now cost Rs 63.37 per litre, a jump of over 19 per cent.
Petrol now cost Rs 67.5 per litre in Kolkata and Rs 68 per litre in Mumbai and Chennai.
The Opposition parties across the country took on the street demanding immediate rollback. They say the government is insensitive to the woes of the common man.
"Sonia and her government are to be blamed for such frequent oil price hike. She doesn't realise the pain of the common man. It’s a failure of our economist PM Manmohan Singh," said BJP leader Ravi Shankar Prasad.
The Finance Minister washed his hands off saying that the decision to hike prices have been taken by the oil companies.
"When we deregulated then we shall have to leave it the judgment of the oil marketing companies' decision," said Finance Minister Pranab Mukherjee.
But if the government did not have any say why was the steepest hike kept on hold till the Assembly results were out.
Experts claim government did not look at other options other than burdening the common man. The government could have restructured duties.
Out of the total Rs 63 per litre, petrol cost is just about Rs 30 on which 5 rupees is added as Basic Custom Duty, Rs 14.35 is Additional Customs Duty and Rs 14.35 is Central Excise Duty. Additional transportation cost and education cess are added on to it.
And if you think that you are done with the petrol bomb, hold your breath. With crude oil prices hovering around 100 dollars per barrel and oil marketing companies still under red, another Rs 4-5 hike may be on their way. Oil companies claim they are still losing Rs 1,82,000 crore.
"India still has to adjust more at domestic level. So I think toward the first half is it likely," said Rajeev Malik, Senior Economist, CLSA.
The Empowered Group of Ministers (EGoM) headed by Pranab Mukherjee is also meeting this week to decide on hiking prices of diesel and LPG gas. That is the real test and is not going to be easy politically.
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