Letters: Fuelling questions

This refers to IndianOil Chairman B M Bansal’s arguments in the debate “Should diesel prices be increased?” (December 22). The debate is in line with the recent statement made by Environment Minister Jairam Ramesh about SUVs being the guzzlers of subsidised diesel. SUVs, however, account for only 10 per cent of total passenger car sales in India. Moreover, SUV consumption would be a minuscule portion of total diesel sales since diesel is the primary fuel used by the transport sector including railways. Thus, to say only SUV owners benefit from subsidised diesel is to hype the issue.

Also, CPI MP D Raja’s arguments voice the age-old demand of reducing taxes rather than increasing fuel prices. This would be tantamount to shifting money from the left pocket to the right pocket, and had it been feasible the government would have continued with the subsidy burden.

 

There is no doubt that the diesel price rise is going to have a huge impact on inflation, which is already steep. But it is a necessary evil. Oil is a limited resource and prices have to and will go up. The government should speed up the infrastructure development process to ensure that we have better roads. This will improve transport efficiencies and bring down fuel consumption, reducing the inflationary impact of fuel price increase. We should also work out a methodology to incentivise people who consume less fuel. This will suit the pocket, reduce demand for fuel and consequently prices, and benefit the environment.

Mayuresh Apte, Mumbai