India: Parties label oil price hike as `anti-poor'

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India: Parties label oil price hike as `anti-poor'

The Times of India News Service

NEW DELHI: Friday night's announcement of sharp increases in the administered prices of petroleum products has evoked an equally sharp reaction from opposition political parties. Nearly all of them have termed the measure as ``anti-poor''.

The Congress's deputy leader in the Lok Sabha Madhavrao Scindia sharply crticised the hike, terming it as ``blatantly anti-poor'', and said it proved beyond doubt that the ``government's incapability to manage the country's economy''. If the government had gone in for long-term purchases planning, it could have ``avoided the oil pool deficit, he added.

In its ``overzealousness'' to control the oil pool deficit, the government, he said, had not spared even the most underprivileged sections or farmers by raising the price of kerosene and diesel. ``The unprecedented increase in the LPG price,'' he said, ``has hit hard the middle class and lower stratas of society.''

The Left parties have jointly called upon all its units to organise mass protest action against the petro productss' price hike. Lashing out at the government, the CPI(M), CPI, RSP and Forward Bloc in a joint statement called the hike ``savage'', which would ``badly affect the common people and inflict more damage to the economy.''

Condemning the hike, the CPI said the steep increase in diesel prices by 17-20 per cent is bound to have a cascading effect on the prices of essential commodities. The CPM pointed out that ironically the hike has come at a time when the international oil prices are on a decline.

Also, that the 50 per cent hike in kerosene prices will hit the poorest and the Rs 36 hike on a gas cylinder would affect the country's households badly. The CPM has demanded the government to reduce duties instead of passing on the burden to the people creating an inflationary situation.

The CPI(ML) said by prolonging the price hike drama for a week, petroluem minister Ram Naik has helped hoarders and black marketeers. CPI(ML) has called for mass demonstration and effigy burning on Tuesday at Jantar Mantar. Pointing out that it is the third oil price hike in a year, effectively doubling the petroluem prices, CPI(ML)-New Democracy stated the NDA government has scant regard for the masses.

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-- Carl Jenkins (Somewherepress@aol.com), October 01, 2000

Answers

Left condemns price hike By Our Special Correspondent

NEW DELHI, SEPT. 30. The Left parties and its trade union organisation, today condemned the hike in prices of petroleum products stating no section of the society will be spared by the rise while the CII and FICCI defended the move.

In a joint statement, the leaders Mr Harkishen Singh Surjeet (CPI-M), Mr A B Bardhan (CPI), Mr Debabrata Biswas (AIFB) and Mr Abani Roy (RSP) called upon party units to jointly organise mass protest actions against the hike and force the Vajpayee government to reduce taxes on petroleum products.

On the other hand, the Confideration of Indian Industries (CII) and the Federation of Indian Chambers of Commerce and Industry defended the price rise describing it as 'pragmatic' and'inevitable' in the present circumstances.

The CPI-M Polit Bureau, in another statement, said the hike in prices particularly on diesel would have a cascading inflationary impact on the economy and that it will reduce the real earnings of the people.

``The hike in kerosene prices is particularly savage. A 50 per cent hike will hit the poorest who are already groaning under unprecedented economic burden'', the party said.

The CPI (M) said it had earlier suggested that instead of passing the burden of the oil pool deficit on to the consumer, the Finance Ministry should reduce its customs and excise duties on petroleum products.

The CPI, in a separate release, said there was no justification in the hike when the international prices have started sliding down. The party said the price rise was in ``sequence of attacks on the livelihood of common people due to the disastrous economic policies pursued by the BJP dominated NDA government. Already the government has made Public Distribution System virtually defunct and dismantled. Due to the present measures of price hike poor and toiling people will be further crushed by the callous and uncared market forces''.

The Centre of Indian Trade Unions, said the argument of the government to justify the 'misdeed is bogus' and that the hike would give render a death blow to the industry.

The Delhi Unit of CPI-ML today said the party would hold demonstration here on Tuesday and burn effigies protesting the hike.

The CII President, Mr Arun Bharat Ram, said the price rise was inevitable given the prevailing global oil supply situation. He said while the oil prices had not gone up sufficiently to totally wipe out the oil pool deficit, the CII recognised the political and economic constraints in doing so.

Mr Bharat Ram said there might be need to subsidise kerosene and to a lesser extent diesel and suggested these should be financed out of a transparent budget subsidy and not put on an ``off- budget'' head like the oil pool account.

The FICCI, said it felt the government had taken a pragmatic approach but added that the price revision would result in some degree of inflation. However, it felt confident that with little aid, Indian industry would be able to overcome the adverse impact of oil price hike.

The FICCI said it also hoped the Finance Ministry and the RBI would jointly work out some packages for encouraging production and growth.

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-- Carl Jenkins (Somewherepress@aol.com), October 01, 2000.


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