Government rolls back hike in excise duty on petrol, halves urea hike
Apparently stung by the criticism that the 17 per cent hike in petrol prices announced by Finance Minister Yashwant Sinha in his Union Budget, was anti-people, the government today rolled back the hike, even as it retained the additional tax of Re 1 per litre. It also announced that the price of urea would be increased only by 50 paise and not one rupee as announced on Monday.
This was announced in the Lok Sabha during zero hour by Sinha following a fierce attack mounted by the entire Opposition on the issue.
Sinha had, on Monday, increased the excise duty on petrol from 20 per cent to 35 per cent, which would have roughly pushed up the cost of petrol across the country by Rs 4. The cascading effect of this on the general transportation costs, including public transport, was apparently realised during the night. He had also announced a one-rupee hike in the price of urea.
The additional tax of Re 1 per litre of petrol, which has been retained, has been earmarked for road development.
Leader of the Opposition Sharad Pawar, the CPI-M's Somnath
Chatterjee, the Janata Dal's S Jaipal Reddy and the Samajwadi Party's
Mulayam Singh Yadav led the Opposition onslaught along with their
party colleagues, and the SP members staged a walkout
even before the finance minister gave his clarification.
The Opposition members were agitated from the outset, and wanted
to raise the matter even before question hour, but were pacified by
Speaker G M C Balayogi, who assured them that he would permit them to
raise the matter during zero hour.
As soon as question hour concluded, Pawar was on his feet with
graphic details of the actual increase in the price of petrol and
urea in the wake of the finance minister's announcement. The leader
of the Opposition also provided details of the actual prevailing price
of petrol in the important metropolitan cities, which he said had
shot up not by Re 1 per litre but in the range of Rs 4 per
litre.
The Opposition leaders, including former Union ministers Murasoli
Maran, T R Baalu and Beni Prasad Verma, vociferously called upon the
finance minister to withdraw the hike.
Jaipal Reddy accused the finance minister of having acted in a
dubious manner on the issue and adopting such techniques while
presenting the Budget which were not straight-forward.
At this point of time, the speaker called on Sinha to
give his clarification, but the finance minister could not do so in
the face of noisy interventions from Opposition members.
In the din, Sinha was heard saying that all queries from the
Opposition would stand answered if he was allowed to give his
clarification.
The speaker kept persuading the Opposition members to allow
the finance minister to give his clarification following which, he
said, he would give them a chance to make their presentations.
In his statement, the finance minister categorically stated that
no liability other than the Re 1 per litre cess was intended.
On urea also, he announced that the government had decided to
reduce the burden by half and the increase now would be barely fifty
paise per kg.
The Opposition members had earlier said that the increase
actually worked out to Rs 1.50 per kg.
The protest by Opposition members continued even after the finance minister's clarification.
Somnath Chatterjee was heard saying that the oil companies,
which were public sector companies, had actually charged the people
more within hours of the finance minister's announcement.
The Opposition members did not appear to be satisfied even after
the finance minister's clarification and the decision to roll back
the hike.
Sinha also drew the ire of members when he made a statement in the
House that the anomaly had been ''sorted out'' between his ministry
and the petroleum ministry and said he was sorry for any
inconvenience caused.
Members sought a number of clarifications such as the fate of the
excess money collected between midnight yesterday and midnight
tonight when the hike would come down to the intended one rupee.
Among the most critical of the speakers was Gurudas Dasgupta
(CPI) who charged the minister and
the government with being casual towards the public.
''The minister should not be allowed to be so innocent -- after
all he has the experience of presenting two Budgets,'' Dasgupta
said.
As for the minister's plea that the matter had been sorted
out, Dasgupta sarcastically reminded the Speaker that the
minister was not seated in his parlour and sorting out a domestic
tiff. ''This is not something between a husband and wife,'' he said.
"People have been squeezed out of their money and nothing is
being done about the millions of overpayment by the consumer," he said,
charging that the whole issue reeked of the unmindful manner in
which the government functioned. ''The government has no mind,'' he
charged.
Sinha further
clarified in the Lok Sabha that the government decided to roll back
by 50 paise the proposed increase in the price of urea, and its
intention to increase it by Re 1 per kg in his Budget speech was
only an announcement.
Intervening in a debate on the suicide committed by several
farmers in Andhra Pradesh, Karnataka, Maharashtra and some other
states, Sinha said the government was committed to uplift the
economic condition of the agriculturists. It was concerned about
them and to improve the credit system in the rural areas. It was
also considering how they could be relieved from the debt trap. If
farmers continued to commit suicide for their inability to pay back
loans taken at a high rate of interest, the country would have to
face grave consequences. There should be no be false propaganda
that the government was not concerned about the farmers, he
added.
Earlier, former home minister Indrajit Gupta (CPI) asked whether
it would be proper for the finance minister to reduce the proposed
hike as it would require an amendment to the finance bill presented to
the House yesterday by him.
The government was pulled up in the Rajya
Sabha by Deputy Chairperson Saroj Khaparde for not
apprising the House of the decision to reduce the increased price of
petrol and urea.
She directed Sinha make a
statement in the House regarding the reduction of the increased
price of petrol and urea.
Raising the matter, Sibte Razi (Congress) said petrol pump
owners in Delhi were charging Rs 4 extra per litre as against the
hike of Re 1 per litre in the Budget. He said the petrol pumps
were pocketing millions of rupees by exorbitantly hiking the petrol
cost and cheating the people.
Minister of State for Petroleum Santosh Gangwar regretted the
inconvenience caused to the people by the petrol pump owners
charging Rs 4 extra per litre and said the matter had been
clarified in the Lok Sabha and the members in the Rajya Sabha would
come to know of it through newspapers tomorrow. Not satisfied with the
minister's reply, the members wanted the minister to apologise for
what they called keeping the House in the dark.
The deputy chairperson then directed the minister of state for
petroleum to make a statement in the House to clarify the position
today itself.
Meanwhile, the Congress has threatened to launch a nation-wide agitation against the "anti-farmer policies" pursued by the BJP
government if it failed to roll back completely levies on urea and
tractors in the next ten days, senior Congress leader Rajesh Pilot
announced in New Delhi.
Addressing a news conference, Pilot said the party would
commence the agitations in states where the BJP'S allies have a
major presence in a bid to embarrass them for supporting an anti-kisan government. The agitation, he said, would start from Punjab
and will be held in Andhra Pradesh, Tamil Nadu, Bihar, West Bengal
and Haryana. The party also plans to hold a massive rally of kisans
in Delhi in the first week of July.
Earlier, giving an elaborate reaction to the budget, party joint
secretary Jairam Ramesh said the customs and excise levies to the
tune of Rs 130 billion proposed in the Budget would fuel
inflation. During the last sixty days since the government came into
being, inflation rate has increased from 5 to 6.35 per cent, he said
adding that budget proposals are a sure recipe for higher inflation.
UNI
Budget '98
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