New Delhi: The ruling Congress party appeared to skirt the issue of its discomfort with the record increase in petrol prices, preferring to publicly call on state governments led by the party to cut local taxes to mitigate the impact on consumers.
One state that followed the instruction with alacrity was Kerala, where a by-election is to be held in the next two weeks, leading to the petrol price there actually dropping. Uttarakhand, where the Congress came to power recently, announced a 25% cut in value-added tax on petrol on Thursday morning.
Meanwhile, Congress ministers and the party hinted that there could be a partial rollback in the steep increase. Two Congress ministers, who did not want to be identified, said the government may consider reducing the price by Rs 2. Petrol prices were raised Rs 7.54 a litre starting Thursday.
“The party is hopeful that some kind of a modus vivendi involving the central government, state governments and the oil companies will be arrived at,” Congress spokesman Manish Tewari told reporters in Delhi. “We are hopeful that the government would find a way out so that some of this burden is eased, which would provide relief to the common man.”
Tewari said the petrol price was not controlled by the government nor could it be a political decision. Following the dismantling of the administered price mechanism, the responsibility for fixing oil prices lay with the oil marketing companies.
Senior party leaders said the increase was “too steep” and that it was “insensitive” on the government’s part not to give the public an explanation.
One party leader said the Congress leadership had directed party-ruled states to bring down local taxes. The Congress-led United Democratic Front government in Kerala, which is gearing up for a by-election in Neyyattinkara constituency on 2 June, has waived additional revenue of Rs 218 crore from sales tax on the increase.
Chief minister Oommen Chandy said after a cabinet meeting that the tax waiver would bring the petrol price down by Rs 1.63 per litre.
Meanwhile, three of its United Progressive Alliance allies—the TMC, the Nationalist Congress Party (NCP) and the Dravida Munnetra Kazhagam (DMK)—chose to absent themselves from the cabinet meeting at Prime Minister Manmohan Singh’s residence on Thursday. While two NCP ministers—agriculture minister Sharad Pawar and heavy industries minister Praful Patel—clarified that they were outside Delhi, the TMC didn’t issue any statement on railway minister Mukul Roy’s absence. In Kolkata, Roy led a TMC protest march with other party leaders and state ministers demanding a rollback of the increase.
When contacted, a DMK leader indicated that chemicals and fertilizers minister M.K. Alagiri may have skipped the cabinet meeting to register his party’s protest against the government’s move. DMK chief M. Karunanidhi has demanded a rollback.
The main opposition Bharatiya Janata Party announced there will be nationwide demonstrations against the price increase on 31 May. The Left parties have already launched a mass agitation demanding the withdrawal of the price hike.
PTI contributed to this story.
liz.m@livemint.com
