Going deeper into crisis

We are so far deep into popular methods that we cannot, but now only strain ourselves to unpopular realistic ways. With that just one look at the Indian economy you can understand this. This is both from the political angles as well as from the point of view of the general mass that have remained in ‘make belief shelters of subsidy’ for whether reasons of their own or by political designs, and now must make grueling work and expose themselves to hardships of rectifying some things unbearable to each one of us as citizens.

The petrol prices have shot up as we all know and whether it is justified when the diesel and LPG remains low is a reason quite hard to understand. If the idea is to tax the rich on the luxury front so that they might as well pay for the fuel for driving around in luxury cars is a bogus argument. The effect of it on the average lower middle class Indian citizens is phenomenal. Many of them in the current economy at least in the cities and towns have two wheelers to ply them to them to their workplace and for sundry visits. This is imperative for control of traffic and also due to the lack of proper public transport system in many places. Besides, two wheelers take up much less space than trucks, buses, luxury cars and others.

It is quite apparent that the art of jugglery being performed here is not substantiate enough to give basis to an argument that the oil companies are running under loss while it quite apparent that the major sale is that of diesel. So how could one stem the rot in the ongoing argument? It is only by deviating from unpopular policies which are again easier said than done. However, sometimes it is better to keep a ‘let go’ attitude while formulating policies for long term public interest than look at the next election. As for the fuel price rise the government will need to take out the ratio of consumption of petrol, diesel and LPG and then accordingly reduce or increase the subsidy accordingly. Just by increasing petrol prices is not a solution to a problem if others are left as they are.

Foregoing or decreasing the taxes is another option, but the government would have to look for other options which are seen to be increasingly remote with the swelling fiscal deficit.

The whole scenario looks tricky as the IIP data has not been inspiring and with the falling rupee it is bewildering why we are not doing anything on the reforms front.

The sad fact is that there is no need for any extra efforts on our front to suck in idle capital from the foreign investors as both US and Europe are in crisis. All we need to do is to cast a proper net of ‘credibility’ and just watch the fishes fall in. Other nations like Brazil, China and even the other South Asian countries are doing it quite well.

And in our case, have we really painted ourselves into a corner so that we can hardly do any more maneuvering.