The largest hike in the price of petrol in a decade, Rs. 6.28 per litre (exclusive of taxes), has caused an outburst amongst the common man and government allies alike. The new price hike came into effect from 12 am, 24th May 2012. Pranab Mukherjee, Finance Minister of India, said, "The decision has been taken, petrol is a deregulated commodity."
A resident of Chandigarh was heard saying, "They don't think, how will people afford a 7-and-a-half rupee hike? The prices are already sky high. This is very bad. The government should think about poor people as well."
Mamata Banerjee, M Karunanidhi and Mulayam Singh Yadav, who play important roles within the government, have called for a rollback on this hike. Lalu Prasad Yadav of RJD, said, "The hike was announced just a day after the Budget Session got over. It's a huge hike. And it keeps increasing."
The change in the price of the fuel comes as a consequence to the Indian Rupee hitting Rs. 56.19 on every US dollar. The real hike will depend upon the sales and local VAT taxes of the region. Delhi will witness an all time high price of Rs. 73.14 per litre against the current price of Rs. 65.64 per litre. Likewise, the fuel will be available for Rs. 78.16 per litre in Mumbai and Rs. 77.53 per litre in Kolkata and Chennai.
The price hike did not go well with Mamata Banerjee, who is a senior member in the UPA coalition at the Centre. However, she clarified that her party, Trinamool Congress, will not back out from the government. She said, "We are not like the CPM or other parties. We are for economic and political stability. Since we have a commitment to support the government, we are not exiting. But that does mean we will not protest what is wrong. What is going on is wrong, one-sided."
She went on to label the raise in the price as 'unjust and unilateral' and demanded the reason for which the government waited until the Parliament session ended to flag off the hike. She maintained that the government allies were not consult by the Congress before taking this decision.
Emphasising upon the need to ask the Centre for a rollback, M. Karunanidhi, the chief of DMK, said, "I wasn't consulted before the decision was taken. I will send my MPs to talk to the Prime Minister." On 22nd May, the UPA celebrated the consecutive 3rd year in power with the dinner at the Prime Minister's house, where M.K. Alagiri, DMK, gave 100 per cent rating to the coalition in terms of performance. However, after the recent development, the party's view seems to have changed.
Pranab Mukherjee said, "The quantum of India's oil imports is substantial at around $160 billion to $170 billion annually." He blamed the global uncertainties and the rising oil imports bill for the fall of Indian Rupee.
In a statement, India' largest oil firm, Indian Oil Company, said that it felt the need to announce the price hike. It was reeling from colossal losses due to the fluctuation in value of Indian Rupee. The statement by the company said, "This excludes losses already suffered till date during current financial year 2012-13, which would require an additional increase of around Rs. 1.50 per litre in selling price of motor spirit (MS) for balance part of the year."
