Veeraiah Konduri
There is no international compulsion on the present BJP Government and yet it went on increasing the fuel prices
Finance Minister Nirmala Sitaraman said recently that reducing prices of petroleum products is not possible till 2026. The key question is if collecting nearly Rs 22 lakh crore to repay just Rs 2.38 lakh crore dues is justified? Let us juxtapose her assertions with the data presented to parliament over the years by the ministry of petroleum and natural gas.
She presented several fallacious arguments changing the goal post continuously, in tune with BJP'S empty promises like depositing Rs 15 lakh into the bank accounts of each Indian. Her statement is motivated by the fact that public at large is resenting the perennial price rise that is reflected in the latest edition of Mood of The Nation Survey by India Today. It is also motivated by Amit Malaviya, head of BJP's IT cell, the churning house of fake news. I am surprised to know the fact that the cell is more knowledgeable of public finances than the Finance Minister.
In 2018, then minister for petroleum and natural gas Dharmendra Pradhan argued that the constant increase of petro prices was inevitable as the Government wanted funds to subsidise food security. This contention is also false as the expenditure on account of food security was reduced from Rs 1,39,419 crore in 2015-16 to Rs 1,08,688 crore by 2019-20. Moreover, the central Government saved a good amount of money from subsidies on petroleum products. The central subsidy on petrol stood at Rs 85,378 crore in 2013-14 but came down to Rs 24,460 by 2018-19, amounting to a saving of nearly Rs 60,000 crore. Same as the case with the savings of Rs 25,000 crore from reduced subsidies on kerosene supplied through public distribution system and Rs 30,000 crore on LPG subsidy. Thus, the BJP government over the last six years saved an amount Rs 1.15 lakh crore by constantly reducing the subsidies on petro products.
Another important reason for the price rise is the ‘under recoveries' argument. The reported under recoveries in 2012-13 stood at Rs 1,029 crore and it came down to Rs 28,249 crore in 2017-18. We could not see any amount mentioned against this head in the latest annual reports of petroleum ministry. That means over the period, the petroleum companies recovered their dues in full. Thus, an additional amount of Rs 1.40 lakh crore has been mobilised through day-to-day price manipulation of petro products. This could only be possible when the constantly increased prices of petro products factors a percentage of price towards this end.
It is well known that a whopping Rs 18.11 lakh crore accrued to the central Government by way of central excise tax, reflecting a 400 per cent increase between 2014-15 and 2020-21. Approximately, another Rs 12 lakh crore accrued to the states. Cumulatively the state and central Governments made a hole in the people's purse to the tune of Rs 32.66 lakh crore of which Rs 20.66 lakh crore went directly to the centre. The reason for this, according to the BJP's IT cell and the finance minister, is to repay the oil bonds raised by the UPA Government.
The UPA Government, due to coalition compulsions, was more sensitive to the public mood. This core aspect of governance is missing from the current dispensation. The issuance of oil bonds was also the result of policy frame work adopted by former finance ministers. The UPA wanted to reduce the burden of under recoveries to the oil marketing companies while reducing the price burden on the common man. With this dual goal the then central Government issued oil bonds. Accordingly, consumers were able to get the petro products at artificially reduced prices. However, the UPA Government was compelled to do so due to the reasons beyond its control over international oil prices.
There is no such an international compulsion on today's BJP Government and yet it went on increasing the prices. The cost of oil bonds issued by the UPA government was Rs 2.38 lakh crore between 2014 and 2026. If the pace of central excise duties continues till 2026, the accruals to the exchequer would be to somewhere between Rs 40-50 lakh crore. That means, the central Government has designed a method that enables it to credit 200 times higher amount than it is supposed to pay without any formal policy announcement. This is the loot that was happening in broad day light over the last seven years. To justify this, the finance minister brought in a fallacious logic that cannot stand even minimal scrutiny.
(The writer is former CWC member of All India Agricultural Workers Union. The views expressed are personal)
