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Initiatives to tackle oil crisis

I fully endorse the views in the editorial, “Tax luxury”. Hiking the excise duty on big cars, multiutility vehicles and sports cars was overdue. Several other initiatives are required to tide over the oil crisis.

Petroleum companies can absorb the oil shock by tightening their belts. There is no justification for public sector units like the HPCL and the BPCL to squander away lakhs on advertisements.

For reducing the cascading inflationary impact of fuel prices, diesel price is kept relatively low which has led to surge in demand for diesel cars. Let the rich pay economic price of fuel and not enjoy the subsidy on diesel. For this the diesel version of the private vehicles should be banned and the use of diesel should be restricted to heavy vehicles.

The subsidy on LPG should progressively be reduced while targeting the subsidy on kerosene used by the poor. This will discourage the misuse of the domestic LPG for heating water in geysers and also its diversion into commercial use. Why can’t the government move towards a moderate specific tax structure (based on quantity) in place of the present ad valorem taxes (based on price) which bring additional revenue with every increase in the fuel price? The people should pay economic price so that fuel conservation becomes a practical necessity. The best way to wean people away from private transport is through an efficient public transport system.

RAMA KASHYAP, Chandigarh

II

The unprecedented price rise is mainly due to the liberal policies of the Centre and the states coupled with hike in the global oil prices. I suggest the following remedies to check prices. Since the global stock of petroleum is decreasing, petrol should be rationed in the country.

The states should control the prices of milk, vegetables, edible oil, fuel, soap, bricks and electricity. The common man’s burden would be greatly reduced. The Opposition parties should suggest ways and means to counter price rise for the good of the poor.

People should cut down their budget upon items whose prices have risen. Let us believe in ‘simple living and high thinking’. Above all, hoarders and profiteers should be brought to book.

P. C. SHARMA, Dhuri (Punjab)

III

“Bold steps needed to control prices”, thus, advises the editorial (June 23). Though I am not a student of economics, I agree with the editorial that the price rise will be an election issue and it may cause the slide down of the UPA.

One question that has always been nagging my mind is: why it is not possible for the state to stabilise the prices of wheat at Rs 10, pulses at Rs 20 and edible oil at Rs 30 a kg? At the same time, the state can raise the prices of cars, ACs, TVs and washing machines to make up for providing the essential commodities at prices as stated. This list is not a rigid one and flexibility is allowed, provided the spirit does not get killed in the process.

B. S. BHATIA, Chandigarh

IV

In these days of skyrocketing inflation, I don’t see the rationale behind the government’s policy of exporting items of essentials like fish, meat, chicken, milk products, tea, fruits and vegetables. Inflation can be checked if we stop exporting these essentials.

Despite the petrol price hike, the situation is out of the government’s control because of the high prices in the international market. Moreover, the special economic zones and malls are not helping the common people. The prices of cement and iron have also jumped. The government should consider the plight of pensioners, salaried class, marginal farmers and formulate policies to help them.

SHER SINGH, Ludhiana