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Wednesday, September 25, 2013

Sensinomics – In a Banana Republic (Indian Version)

This is absurd! On a fine morning, rumours were in the newspapers about the possible climb down of petrol price in the context of Rupee regaining its value graph and stability of crude oil price in the International market in the context of Syria war getting distanced; thanks to Russian intervention. However, in reality petrol price shot up overnight?! A common man with minimum economic sense would not able to comprehend the reasons cited by the ministry, as there is neither a major fall of rupee from its previous day’s position and nor that Syria situation had worsened. In fact, Syria’s position had improved with the introduction of Russia – US pact! Another important aspect is that the Rupee gained value in the context of proposed news about the control over imports. Despite all these, our petrol prices are going skywards….What’s this (black) magic?

Economic common sense or ‘Sensinomics’ does not allow me to understand/ comprehend any logic offered by the Petroleum Ministry and other concerned authorities in unison, consistently over a period of time. Their pseudo genuine reasoning against the expected price climb down is that the effect of the Rupee gain will come into reality only after one or two weeks?? But when it comes to effecting the Rupee devaluation, it happens overnight?? Moreover, in the context of stable international price and relatively stable Rupee, why there is an unprecedented price rise? Inexplicable….?!

In this scenario, the Sensinomics do not understand the reason for the absence of role of the State with firm action?! Is our Government afraid of someone to act tough or is it just the lackluster approach?  The State is expected to assure the quality of life through timely interventions for the rights of the people and here is a republic where the State looks helpless at such junctures despite collecting multiple taxes and surcharges; ever increasing…! The taxes collected for petroleum products are much higher than the subsidy offered and there is a steady graph in the last few years, where subsidy is being cut down/ delayed and the price is made dearer & dearer….! In fact, it should have been in the reverse order. Sensinomics do not state that the subsidy should be increased; but I would definitely say the taxes and surcharges should have been kept at a steady level, at least for a financial year. These ‘Once-in-15 days’ price review brings these taxes and surcharges along with it which is not envisaged in our budget and this additional revenue is neither spent for the betterment of the people nor it is used to effectively bring down the price. In fact the tax envisaged during the budget is what is actually sanctioned and it should be kept as a fixed amount even in the scenario of ‘basic price’ increase. This will at least bring some relief to the common man. 

A recent survey indicates that 62% of the total consumption of petrol amounts to two wheelers and that belongs to the massive middle class or common man of the country. Hence, the increase of petrol price to save diesel price hike does not benefit the common man; instead, it directly affect the common man by increasing his daily expenditure. Sensinomics recommend removal of the ‘uncouth gooses’ sitting for a long time at the helm of ‘(Un)Planning Commission’; who neither understand anything other than their vested interests. This is the modest word I could find in the dictionary to describe them!

If we do not respond to such atrocities, those concerned will take us for granted and keep taking us for such grand royal rides…!

Note: It is 10 days since I started writing this and this so called 'petrol price reduction' has not happened yet...?

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