arrite people..
all of us vud b aware of da recent chastisement and admonishment that the UPA govt hz been subjected to in the wake of recent spurr in da oil prices...
before arriving at any conclusion, let me show u some contentious facts in dis scenario..
crude oil price ( jan 2007) : 50 $ / barrel
crude oil price (june 2008) : 140 $ / barrel (touched)
retail price ( petroleum : jan 2007 ) : 40 Rs/ ltr
retail price ( petroleum : now ) : 50 Rs / ltr
now then, after a reasonable comparsion using da basics of ratio n proportion , you wud hv easily realised that comaritive increase in the prices r quite blunt and stoic in the wake of the increase in global oil prices. so, were does this subsidy comes from.??
It comes at the cost of the fiscal deficit that the government submerges itself into at the cost of allocation of resources to other areas like infra or education... d nightmare losses suffered by public sector oil companies cannot go without a mention.
another set of facts :
the cost of subsidy borne by the government of petrol has distended to : Rs 20000 crore
just compare that with the amount slated to be spend by the government on education in the fiscal : Rs 1500 crore
this gives a rough idea on the pressure borne in by the government in subsidising petrol proces. another aspect holds that, since the prices of petrol in India are not puristically market determined, therefore an exact demand - supply relationship may never be established in totality with respect to petrol. hence , a perfect demand point cannot be reached with respect to petrol unless the prices are solely market determined.
so, in lieu of all the above points, i think the UPA deserves a slight "pat on the back" to go ahead with a positive move dispite heavy critisism from its allies and election time approaching...
vat do u think , mate..??
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2 comments:
lmost al u said z lmost rite...bt vr upa hz failed z dat it hz teken dis unly as a stop gap arrangement!! y vs de rise nt brot in2 effect vn de crude oil prices were rocketin initially..at dat time upa vs baskin in its own glory of 9% growth n populism n bla bla...vt i feel z dat it hz cum a bit late aftr de public sector oil cos. hv hit rock bottom...guess populism reigns abuv evrythin in indian politics.its rely time 2 undo sum stupid measures n goin 4 de facts...vts ur tek on de farmer's loan remuval plan of de govt. hu ll tek care of dat deficit n is it really gonna help dose poor vidharbh farmers or it ll b jz another gimmick....time ll tell lets watch n wait!!
Yeah anjani...
completely agree wd u...
probably 4 UPA, dis saying goes gud : " der iz a lil' angel in the worst of us"...
it cud hv gn wd its populist vote again as da elections vr cmng... but finally dwn da line dey realised da unforseen loss dt wz occouring...
vl...nd as far as da farmer loan waiver program wz concerned, dt wz a huge huge mistake... i wonder w 2 of da country's most adroit, skillful n respected economic minds..one da PM...odr da FM..could fall in such an open nd distrought gimmick..
vl...da farmer loan waiver scheme wz a disaster fr 3 reasons..
1.> it made da honest farmers ( dose who paid da interests in time) luk absolutely stupid...
2.> it hz set a vry wrong precedent in votebank polity..
3.> farmers vl b more cautious next time round paying der dues.. for dey mit forsee anothr waiver comng soon... n y risk luking stupid paying da dept while da govt vl draft anothr scheme...
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