Month: May 2012

Petrol price hike

On 22/5/2012 Budget Session of Parliament ended and UPA 2 celebrated its third anniversary. Till 1998 there was no tradition of a government celebrating its anniversary. Governments headed by Jawaharlal Nehru, Lal Bahadur Shastri, Indira Gandhi, Morarji Desai, Rajiv Gandhi and Narasimha Rao did not celebrate their anniversaries. Other governments lasted less than a year. The tradition began in 1999 when NDA government headed by BJP’s Atal Behari Vajpayee celebrated its first anniversary. For BJP it was a great achievement. Their government in 1996 had fallen within 15 days.

On 23/5/2012 petrol price went up by 7.50 rupees or more. Some said it was UPA’s gift to people on their anniversary. Many were angry. They said the hike hit common man. Some justified hike. Some said the hike was done by oil marketing companies (OMCs). Satyavrat Chaturvedi admitted it was a government decision. Some said the people who use cars are not common people. They are middle class or rich people. There is fiscal deficit that needs to be bridged. Dollar value has gone up. OMCs are bleeding. Subsidies should go. Prices of diesel, LPG and kerosene should go up. Some said the hike should have been gradual. Some demanded rollback. BJP announced Bharat Bandh.

Foreign companies do not want to invest in India because after 2G case and Vodafone case it is a no-win situation for them. In 2G case, the government gave 122 licences and Supreme Court cancelled them and the government did nothing. In Vodafone case, Vodafone won the case against the government in the Supreme Court and the government changed the law retrospectively. Foreigners who can take out their money are doing it. Even Indian companies do not want to invest in India. They want to invest outside India. Demand for dollar led to rupee depreciation. India had two options. One was to sell dollars till rupee became strong enough and OMCs did not make loss. Second option was to tell Saudi Arabia and other petroleum exporting countries that we will pay for oil in rupees and if they do not agree we will import all the oil we need from Iran. The government did not use these two options.

There are petrol cars and diesel cars. Petrol is used by taxis and autorickshaws. Petrol price hike affects common people. If oil companies are bleeding they should be shut down. Private companies can import and sell oil. During NDA rule there was a decision to privatise OMCs. Ram Naik was petroleum minister. He did not want to lose his power. He got George Fernandes to oppose privatization of OMCs. NDA lost power.

Fiscal deficit is due to spending more than income. Corporates talk of schemes like NREGA that cost corporate amounting to 5,00,000 crore rupees per year are the reason for the deficit. Someone mentioned expenses incurred by president, ministers and MPs. For people like Rajiv Kumar of FICCI, 205 crore rupees spent on tours of Pratibha Patil may be a small amount but not for a majority of Indians. Corporate debt restructuring is a reason for fiscal deficit.

There is talk of austerity but not much action. Foreign tours by ministers were supposed to be off but petroleum minister Jaipal Reddy was in Ashgabat when the hike was announced.

Bandh is wrong. There should be no Bharat Bandh. BJP and other parties should protest without causing inconvenience to people. They can have fast at Jantar Mantar for a day. UPA should explore the two options to reduce oil prices.

Indian lootocracy

India, besides being a mobocracy and quotocracy, is a lootocracy. People in power and those who can influence people in power through bribes and other means loot the country. Politicians want to loot the country even after they lose power. When there is criticism of politicians some say “Don’t criticize politicians. All are not bad. There are some good politicians.” After some demands for privileges by former speakers Purno Albert Sangma and Somnath Chatterjee it seems no good politician is left.

It is a shame that P. A. Sangma and Somnath Chatterjee wrote to Meira Kumar for privileges former speakers. Other former speakers are Balram Jakhar, Rabi Ray, Shivraj Patil and Manohar Joshi. P. A. Sangma and Rabi Ray were Speakers for less than two years. Manohar Joshi was speaker for two years. Purno Albert Sangma and Somnath Chatterjee wanted privileges because former presidents, vice presidents and prime ministers get privileges. Somnath Chatterjee later said he made a request, he does not want a house in Delhi, when in Delhi he wants secretarial staff, a car and driver.

When the constitution was framed only the president was entitled to some privileges, like free house and pension, after ceasing to hold office. Over the years the privileges were extended to vice president and prime minister. Some years back law was changed to enable even a spouse of a former president to get benefits. If former speakers get benefits deputy speakers and deputy chairpersons will also demand benefits. Meira Kumar is willing to grant privileges to former speakers. She too can enjoy those privileges when she becomes former speaker.

Industrialists who bribe politicians in power grow richer. If they make profit, they keep it. If they make losses government bails them out by corporate debt restructuring. Those who do not bribe get into trouble even if they have broken no law. If they win the case in Supreme Court the law gets changed retrospectively. If Vodafone had bribed people who mattered, the law would not have been changed retrospectively by way of clarification in Finance Bill 2012. If 122 telecom companies whose licences were struck down by Supreme Court had bribed people in power a new law would have nullified the judgment.

Bureaucrats who loot the country have made lot of money. Their salaries are in thousands, the bribes are in crores. Some were found with more than 100 crore rupees.

There are journalists who assist politicians, bureaucrats, industrialists and others in looting the country. Some journalists report some small cases of corruption but do not report big cases. When some big cases become public knowledge these journalists justify the corrupt.

When central government grants privileges, state governments follow suit. In some states former chief ministers get free houses. MLALADS and MLCLADS followed MPLADS.

The loot of the country must be stopped. Privileges should be scrapped. If anyone has to be provided security it should be at his/her private residence. Security should be provided if there is need and not as status symbol. It should be to the people who held office and not to their family members. Former presidents, vice presidents, prime ministers and their family members should be asked to vacate houses provided to them. They should travel at their expense.

We should abolish pension for MPs. There was no pension till some decades back. Then MPs gave it themselves. It was for those who were MPs for five years. Then it was changed to all MPs. So if someone is MP even for a day he gets pension for life. For those who were MPs upto five years it is Rs.20,000/- p.m. For others it is Rs.1,500/- p.m. more for each additional year completed. The number of ex-MPs being more than 1,000 pension per month will be more than 20 crore rupees per month.

Excise on gold

On 7/5/2012 Finance Minister Pranab Mukherjee announced rollback of excise on gold. Nobody spoke against rollback. Jewellers had opposed it. Sriprakash Jaiswal, a minister, had talked against it. Being coal minister he had nothing to do with gold. Delegations of jewellers had met Sonia Gandhi. There were no discussions on TV channels against rollback.

Gold is not a necessity. Jewellers on strike would not have made much difference to ordinary people. Marriages would have taken place without gold.

When there is rollback of price rise of diesel, petrol, kerosene and LPG there are discussions on TV channels. There is criticism that this is good politics and bad economics. When excise on gold is rolled back there is no discussion. TV channels get ad revenue from jewellers. Free news media is a myth. When TV content is dictated by who gives ad revenue there is no freedom.

If the ground for rollback is that it will lead to corruption and harassment, that applies to excise on all items, not just for gold and jewellers. Other businessmen also face harassment. Excise on all items should be abolished.

There is service tax on various items and people who raise bills have to collect service tax and deposit it with the government except for transport. Transporters raise bills that do not mention service tax but service tax is deposited by people who make payment.

Rule of law means equality before law. When law is applied differently there is no rule of law. When jewellers and transporters are treated differently it is wrong.