On Tuesday, Congress’ interim President Sonia Gandhi wrote to PM Modi urging the government to immediately roll back the price hike.
Congress President Smt. Sonia Gandhi writes to the Prime Minister urging the govt to immediately roll back hikes on fuel prices & pass the benefit of low crude oil prices to the citizens. pic.twitter.com/NQstx7v5Ac— Congress (@INCIndia) June 16, 2020
In the letter, she claimed that India is facing unprecedented public health, economic and social challenges due to the Chinese coronavirus pandemic and blamed the government for taking an “insensitive” decision to increase fuel prices on ten different occasions.
She added in her letter that the central government had earned an additional revenue of Rs.2,60,000 crores by “ill-advised” hikes in excise duty. While the international crude oil price has gone down by 9% over the last week, the Modi government is just profiting off the people. She blamed the government for increasing the excise duty of petrol by 258 percent and diesel by 820 percent that translates to additional revenue of Rs.18,00,000 crores. In the end, she again urged the government to put the money directly in the hands of those who need it.
Congress’s hypocrisy over fuel price hike
Even as Congress hits out on the central government over fuel price hike, the states under Congress rule have repeatedly increased fuel prices to increase revenue. On 15th June 2020, the Punjab government announced an increase in VAT on both petrol and diesel. The Punjab government increased VAT on petrol from 23.3 percent to 26.43 percent and on diesel from 15.15 percent to 15.98 percent. Through this move, the Punjab government is looking at realising an additional Rs 250 crore to Rs 300 crore per annum as the revenue. Last year in February, the Punjab government increased the petrol price by Rs.5 and diesel price by Rs.1 in one go.
Similarly, in March 2020, the Rajasthan government decided to increase VAT on diesel from 22 percent to 26 percent and VAT on petrol from 30 percent to 34 percent. On 31st May 2020, the Maharashtra government increased cess on fuel price. The government issued a notification and increased cess on petrol from Rs.8.12 to Rs.10.12 and on diesel from Re.1 to Rs.3. In April 2020, the Puducherry government increased VAT on petrol and diesel by 1%. In a notification issued by Secretary to Government, Finance on 7th April, the new tax rate for petrol was 22.15 percent and for diesel, it was 18.15 percent.
Transport industry unhappy with the hike
Despite low crude oil prices in the international market and India’s attempts to increase its oil reserves in the last couple of months, the general public not too happy as benefit is not passed on to the end consumer. Fuel prices in India have increased every day since June 7 to regain the losses incurred during the coronavirus-related lockdown. Currently standing at Rs.76.73 per liter in New Delhi, Petrol prices have increased by 47 paise since yesterday. These fuel prices are increased by the OMC (Oil Marketing Companies like HPCL, Indian Oil) which have done so because of increase in excise last month.
The transport industry has condemned the fuel price hike in the form of a strong protest. Truckers said that operating vehicles would become more difficult for them with a continuous increase in the price. All India Motor Transport Congress (AIMTC) said that the lockdown has been tough for them and the pandemic has hit their revenues quite hard.