NRC: The Soul of Assam Accord

Opposition parties are once again looking for political opportunities in a situation, which has the risk of blowing up because of their incendiary rhetoric. Every attempt is being made to create a crisis where it does not exist. It is grossly premature right now to speculate on the future of the people who are being authoritatively identified as illegal immigrants. Religion, region and caste have always affected politics but governance has to be above it.

A perfectly legitimate exercise by the Assam government under an Assam accord has now led to a deplorable and condemnable reaction from the opposition parties. The Congress Party and its national president Rahul Gandhi must make his stand clear on the issue of illegal immigrants from neighboring countries. Historically, both Mrs. Indira Gandhi and Mr. Rajeev Gandhi had committed, that post 25th March 1971 migrants would be detected, identified and deported. It was the Congress that had agreed to the preparation of NRC but later did nothing in this matter because these immigrants were mostly Muslims and it cultivated this group as its vote bank.

For its vote bank, Congress was encouraging illegal immigrants left, right and center. It also tried to subvert Foreigners Act 1946 by bringing Illegal Migrant Determination by Tribunal (IMDT) Act, 1983 which was stuck down by The Supreme Court in 2005 in the case filed by the present Chief Minister of Assam, Sarbananda Sonowal vs UOI (2005), by stating that IMDT “has created the biggest hurdle and is the main impediment or barrier in the identification and deportation of illegal migrants”.

The Conduct of Congress in the whole affair requires a closer scrutiny. The IMDT Act had virtually made it impossible for the government to identify and deport illegal immigrants. The constitutionality of this Act was challenged in the Supreme Court of India, in the affidavit filed by the Assam Gana Parishad (AGP) led Assam Government on 28^th August 2000, stated that the State Government has been persistently writing to the Central Government that the IMDT Act was operating against national interest and therefore the Central Government should repeal the IMDT Act. In May 2001, AGP was defeated in the Assam elections and the Congress led government came to power. On 8th August, 2001, the Congress government of Assam moved an application in the Supreme Court praying that the State of Assam be permitted to withdraw the earlier affidavit and be allowed to file a new affidavit, stating that ….the IMDT Act is constitutional and there is no question of either repeal or striking down of the Act."

At the Centre, The Atal Bihari led NDA government filed its affidavit in the matter on 18^th July, 2000, in which has it stated that a proposal to repeal the IMDT Act was under consideration of Government of India.  However, after the Congress led UPA government came to power at the Centre in 2004, another affidavit was filed in the matter on 24^th November, 2004 wherein it was said that though in the earlier affidavit a prayer was made to examine the constitutional validity of the IMDT Act, but on reconsideration the Central Government had taken a decision to retain the IMDT Act in present form in its application to the State of Assam. Ultimately Hon’ble Supreme Court stuck down IMDT act in 2005. The Court further observed: “The dangerous consequences of large scale illegal migration from Bangladesh, both for the people of Assam and more for the Nation as a whole, need to be emphatically stressed. No misconceived and mistaken notions of secularism should be allowed to come in the way of doing so”.

 

It would not be an exaggeration to say that at the root of every socio-politico problem in the country lies the myopic politics of the Congress. The flip-flop resulting from this myopic vision is evident on its stand on Triple Talaq, Supreme Court judgment on maintenance to Shah Bano, illegal immigrants from Bangladesh, Ram Temple at Ayodhya, plight of Kashmiri Pundits, Minorities having the first right on the national resources, etc. Communalizing Indian politics to the core.

Similarly, Ms. Mamta Banerjee’s ambitions have also pole-vaulted in recent times; she sees it as an opportunity to consolidate her Muslim vote-bank in West Bengal. She has dishonestly compared this as a restriction on interstate movement of citizens of India and is trying to make it a Hindu-Muslim issue. We hope she explains her stand on the issue of illegal immigration from Bangladesh. Earlier on 4^th August 2005, she had stated in the Lok Sabha: “The infiltration in Bengal has become a disaster now. You can see the Bangladeshi as well as the Indian names in the list. I have both the Bangladeshi and the Indian voters list. This is a very serious matter. I would like to know when would it be discussed in the House?”. The silence and ambivalence of other political parties like the CPI, CPI (M), BSP, SP, RJD also reeks of hypocrisy.

Under governance parlays, how much does it matter if 70 percent of the people left out from NRC are from the Muslim community? After all, the illegal immigrants, who came in hordes into Assam, are not refugees. The movement under the banners of AASU AAGSP had emerged because the unabated influx of illegal foreigners in to Assam had raised substantive fears in the minds of the local people about its adverse effects on their social, political, cultural and economic life. The 2011 Census of India shows Assamese-speakers have become a minority in their home state. Between 1991 and 2001, their population had declined from 58 percent to 48 percent. In terms of religious communities, the Muslim population of Assam had increased from 25 percent in 1951 to 34 percent in 2011.

All political parties should express their stand on the issue of illegal immigrants into India in no uncertain terms so that we all know where they stand on this matter. Fear mongering and hyperventilation would not serve the interests of the nation, as would keeping quiet on the issue.

Gopal Krishna Agrawal

National Spokesperson of BJP

gopal.agarwal@bjp.org

The Economy Deplomacy Is a Key To Enhancing Nepal - India Relation

Gopal Krishna Agrawal is the National Spokesperson on Economic Affairs for ruling Bhartiya Janata Party of India. How does he see Nepal-India economic relations? How can this relations be enhanced? Mahavir Paudyal and Kosh Raj Koirala spoke to him on Nepal-India economic ties and other aspects of bilateral relations while he was in Kathmandu last week.

How do you see the current status of Nepal-India relations?

We are working on making Nepal-India relations much better than what it is today. Nepal is very important country for India’s international relations. This is why Prime Minister Narendra Modi visited Nepal right after assuming office in 2014. We find so many common issues with regard to economy between Nepal and India. Thus we can have a very good business and economic relations. Economic relations are much important for these countries because economic relations are becoming more important between and among the countries across the whole world. Economic issues can be more easily identified and they are as easier to resolve because they are based on give and take and mutual benefits. There will be few contentions in business relations than would be with political relations. You say so but Nepal has had huge trade deficit with India. 

One of the ways would be if the two countries maintain relations with industrialists with both sides, instead of focusing on only government-to-government relations.  It’s better for Nepal and India to organize bilateral economic conclaves at a reasonable frequency so that they can discuss issues and find solutions.  Private sector bodies of Nepal can have direct contact with Indian investors through Indian business organizations.  If they talk with each other directly, many things can be settled. The government of Nepal can also communicate their policies directly with the Indian industrialists. If Nepal establishes direct contact with Indian industrialists, it would know their concerns and also find out the factors that have hindered investment in Nepal.  The government will also come to know directly what their concerns are and how those concerns can be addressed. Equally important is to incentivize the investment.  Creating Special Economic Zones, cluster development models, integrated supply chain models with global suppliers etc are some incentivizing factors.  They have done a lot for India. Such ideas might be as useful for Nepal.  
You cannot look into any initiative in isolation.  When our party took over, there was a problem with regard to tax compliance and large part of business transaction was not being channeled through financial institution mechanism.  There was a need to push transaction through digital banking. We had to establish the audit trail of business transactions. And there was a need for identifying the concerns of liquidity and the issue of shifting the informal sector into formal sector. Several other steps together with demonetization helped into creating an ecosystem whereby we are moving informal sector into formal sector.  The GST could not have been as successful if we had not made concerted efforts to moving towards digital economy and digital banking. Cumulatively, demonetization has created an ecosystem that has greatly helped minimize corruption. We have been able to establish audit trail of all transactions.  The government has deregistered around four hundred thousand companies found in money laundering. Because of these steps, we now have more transparent and corruption-free ecosystem and it’s easier to do business in India. Most of all, tax compliance has increased, thanks to the audit trail.  
I think this is for Reserve Bank of India to decide. Central banks of Nepal and India should work to resolve issues related to Indian currency in Nepal.  
Rise of petroleum price and depreciation of Indian rupees against dollars are two issues facing us at the moment. There are global factors behind it. This could have been addressed by direct intervention by the central bank but the government has decided it is not yet time for intervention for domestically we are in better situation. Our GDP grew by more than 8.2 percent.  Inflation is well under control. It is 3.6 percent at the moment. Our foreign exchange reserve is more than 24 billion dollars, which is very healthy. Our current account deficit is well within the limit.  And we are getting a lot of FDI. Depreciation is largely driven by external factors. Our domestic factors do not require us to act for immediate strong measures. 
You should not take one or two sporadic incidents and make a judgment. The intention of the Indian government is very clear.  Our focus is on smooth trade between the two countries and establishing even better connectivity for this.  We are developing connectivity infrastructures including with Nepal to enhance trade relations.  India has put BBIN in priority for the same purpose.   The government is open to resolving all kinds of issues. Media reports sometimes create completely different perceptions. We need to read them critically. We have good trade relations even with countries with which India does not have so special relations.  We have special relations with Nepal.  There is no reason why we cannot have smooth trade with the neighbor with which we have a special relations. 
I think it is unwise to link what you call blockade with Hindu concern. Indian government has consistently denied blockade. Yes, India showed some concern for people of Tarai but at the same time India has always maintained that it’s up to Nepal to do whatever is best for Nepal.  The opinions of general people should not be equated with opinions of the government.  As for Hindu state, we had always appreciated Nepal as a Hindu state because over 85 percent of Nepalis are Hindus.  India is also a Hindu dominated country. So there have always been positive sentiments among Indians regarding Hindu state status of Nepal.  But that too, like I said, is the public opinion.  India is a secular country. We cannot say what should be the status of Hindu religion in Nepal. It’s for Nepal to decide.  The government does not have any position on this.  What individual leaders say are individual opinions. They should be understood as such.

I was recently speaking on foreign direct investment issue here in Nepal. Across the world, every country is looking to attract more FDI.  FDI is one of the criteria which decide what will be the future of country’s economy. It is important for capital formation and building of infrastructures. India has been successful in attracting huge FDI over the last few years. We have been able to get 62 billion dollars of FDI, which is the highest FDI across the world.  But a country cannot raise FDI rate simply by asking others to come and invest. Most of such investments come from the private sector. And private investment comes to those places where you have strong regulatory bodies.  They look into which regulatory set ups are there that can come to their aid when something goes wrong with business. Foreigners are ready to invest in India because we have strong and autonomous setups in many the fields such as banking, capital market, insurance, telecommunications etc. For each of these sectors, we have a separate regulatory body to boost the confidence of the investors. 

Thus the more you build autonomous and independent regulatory institutions the more it will raise confidence of foreign investors. And the more you will be able to attract FDI. I think this applies to Nepal as much it does to India. 

The importance of FDI is obvious but how can Nepal reduce trade deficit with India?

Many Indian investors are willing to invest in Nepal. Nepal has a lot of hydro potentials. After the success of Arun III more companies are interested to come to Nepal and invest.  Indian companies are also interested to invest in tourism, education and many other sectors. Private education industrialists can set up their institutions in Nepal.   If two countries have good business relations it will directly contribute to minimizing tensions, if any, on diplomatic and political fronts.  Economic diplomacy can become a key tool in further enhancing Nepal-India relations.  This is what is happening globally. Leaders across the globe are now more focused on economic issues. Through economic cooperation and considerations it is easier to build better diplomatic relations.

The demonetization drive was criticized by some sections at one time. How has it helped Indian economy? 

Demonetization has affected a lot of Nepalis. The government of India has refused to exchange Indian currency possessed by many Nepalis. One of economic issues in India at the moment is depreciation of Indian rupees against US dollars. This might have direct bearing on Nepali economy for our currency is pegged with Indian currency.Exporting ginger to India from Nepal has rarely been a hassle-free undertaking. Now and then Nepal-bound containers are held up in Kolkata port. One of the persistent concerns of your party has been regarding Hinduism in Nepal. One of the former Nepali prime ministers recently said India imposed blockade on Nepal in 2015 because Nepali leaders failed to address India’s concern related to Hindu state. 

Fuel Price Crisis: Issues Behind Petroleum Rates Explained in 7 Points; Lowering Dependency On Oil a long Drawn

By Gopal Krishna Agarwal, 

It is evident than in order to reduce our dependence on imported oil, we need to generate more energy from coal and lignite, which we have in abundance and also focus on electricity generation from hydro and other renewable sources.

India imported 256.32 million metric tones of crude oil and petroleum products in 2017-18 and paid Rs. 6, 52, 896 lakh crore. The import dependence of India in the case of crude oil is over 80 percent.

What is the benchmark crude price for India and how is it determined?

The Indian basket of crude oil represents a derived basket comprising of Sour grade (Oman & Dubai average) and Sweet grade (Brent Dated) of crude oil processed in Indian refineries in the ratio of 72.38:27.62 during 2016-17. The price of Indian crude oil basket was $106.85 per barrel (1 barrel=159 litres) in May, 2014. It fell down to $39.88 per barrel in April 2016 and has gradually increased since then and is around $78 per barrel.

What is the tax structure on petrol and diesel?

On 3^rd September, 2018, the price build-up for Diesel and Petrol in Delhi was as follows

Every dollar increase in the international price of crude oil increases the cost of petrol and diesel in India by Rs. 0.50/ litre and a fall in the exchange rate of the Indian rupee against US dollar increase the cost of petrol and diesel in India by Rs. 0.65/ litre.

What is the revenue generated by taxes on petroleum products?

The contribution to central and state exchequer by the petroleum section in the last few years is as follows:

42 percent of the Basic Excise Duty collection at the Centre is given to state governments for infrastructure and welfare programs and 60 percent of the balance 58 percent of the Basic Excise Duty collection is spent on Centrally Sponsored Welfare Schemes in the States i.e. total amount transferred to States is (42+34.8)= 76.8 percent.

Every one rupee reduction in central duty leads to a loss on about Rs 14000/= crores to the central exchequer.

How does the picture of under-recovery in the oil and natural gas sector look like?

Under Administered Price Mechanism (APM) earlier Petrol /diesel prices were not market linked and prices were being modulated, the steep increase in international prices of oil used to exert severe pressure on the oil marketing companies (OMCs). The retail prices of these commodities were kept below the cost resulting in large under-recoveries for OMCs.

From the year 2004-05 to 2013-14, the total under-recoveries was Rs. 8,53,628 crores.

Why oil bonds issued and what were is their current status?

During the period of 2004-08 when the international crude prices were increasing rapidly, the government started subsidizing petroleum products proved grossly insufficient but since the fiscal position of the government was already precarious, it could not increase the subsidy to this sector. The government resorted to the issuance of ‘oil bonds’ to the OMCs. These interest-bearing bonds were not even reflected on the balance sheet by the UPA government, resulting in artificial measurement of the burgeoning fiscal deficit.

Between 2005-06 and 2009-10, oil bonds worth Rs. 1,42,202 crore were issued by the government with the rate of interest on them ranging from 7.33 percent to 8.4 percent per annum repayable up to 2024-25 by successive governments. Oil companies have either sold these bonds or used them as collateral to raise cash. OMCs have sold oil bonds worth Rs 1,24,536 crore and had to bear a loss of around Rs 5,000 crore in selling of these bonds at a discounted rate because the bond market did not have much appetite for these bonds. Till date the government has repaid around Rs. 70,000 crore to the holders of these bonds and out of this amount, only Rs. 10,000 crore (approx) has gone into the repayment of the principal component and the rest towards the interest obligation. Thus the outstanding principal amount on these bonds is Rs. 1,30,000 crore. Most of these bonds will be matured by 2024-25

How crucial are petroleum products in our energy mix?

In the year 2015-16, the source-wise share in consumption of energy was as follows:

How can India reduce its dependence on crude oil?

Petroleum products are important because one cannot readily switch between them and other sources of energy. To make our economy less dependent on oil would be a long-drawn process, which can be accelerated by conducive government policies. Modi government is working on this long-term solution.

 It is evident than in order to reduce our dependence on imported oil, we need to generate more energy from coal and lignite, which we have in abundance and also focus on electricity generation from hydro and other renewable sources like wind and solar. Since the government is focused on having 1 GWh of installed solar capacity by 2022, we will see an increase in its share in the source-wise energy share in the coming years.

Why Renewable energy is so vital for India

By Gopal Krishna Agarwal,

Petroleum prices have always been a contentious issue in India. Historically, political expediency overrode economic considerations. The central government has some compelling reasons not to interfere with market forces, which are currently being affected by global factors.

 India imported 256.32 million metric tonnes of crude oil and petroleum products in 2017-18, for which it paid Rs 6.53 trillion. India's import dependence in crude oil is over 80 per cent. The Indian basket of crude oil represents a derived basket comprising of sour grade (Oman and Dubai average) and sweet grade (Brent dated) of crude oil processed in Indian refineries in the ratio of 72:28 in 2016-17. The price of the Indian crude oil basket was $106.85 per barrel (1 barrel = 159 litres) in May 2014. It declined to $39.88 per barrel in April 2016, and has gradually increased since then and is around $78 per barrel now.

 

It is important that we look into the tax structure and petroleum prices. On September 3, 2018, the prices of diesel and petrol in New Delhi were Rs 71.15 and Rs 79.15 respectively (rounded off). With every one-dollar increase in the international price of crude oil, the cost of petrol and diesel in India increases by Rs 0.50 per litre, while a fall in the exchange rate of the rupee against the US dollar increases the cost of petrol and diesel by Rs 0.65 per litre.

 

The revenue generated by taxes on petroleum products is vital for both central as well as state governments — the total contribution to the central and state exchequer was Rs 4.93 trillion in 2017-18.    

 

It is important to remember that 42 per cent of the basic excise duty collection at the Centre is given to state governments for infrastructure and welfare programmes and 60 per cent of the remaining 58 per cent is spent on centrally sponsored welfare schemes in the states. The total amount transferred to the states is thus 76.8 per cent (42+34.8). Every one-rupee reduction in central duty leads to a loss of about Rs 140 billion to the central exchequer.

 

Earlier, under the Administered Price Mechanism (APM), when petrol and diesel prices were not market-linked and prices were being modulated, the steep increase in international prices of oil exerted severe pressure on the oil marketing companies (OMCs). The retail prices of these commodities were kept below cost, resulting in large under-recoveries for OMCs. Between 2004-05 and 2013-14, total under-recoveries amounted to Rs 8.53 trillion and there were significant subsidies.

 

Subsidies for these under recoveries during the period 2004-08, when international crude prices were increasing rapidly, proved grossly insufficient. Since the fiscal position of the government was already precarious, it could not increase the subsidy to this sector. The UPA government then resorted to issuance of “oil bonds” to the OMCs. These interest-bearing oil bonds were not even reflected in the balance sheet of the UPA Government, resulting in artificial measurement of the burgeoning fiscal deficit.

 Between 2005-06 and 2009-10, oil bonds worth Rs 1.42 trillion were issued by the government, with a rate of interest ranging from 7.33 per cent to 8.4 per cent per annum, repayable up to 2024-25 by successive governments. Oil companies have either sold these bonds or used them as collateral to raise cash. OMCs have sold oil bonds worth Rs 1.25 trillion and had to bear a loss of around Rs 50 billion in selling these bonds at discounted rates, because the bond market did not have much appetite for these bonds.

 

So far the government has repaid around Rs 700 billion to the holders of these bonds. Of this amount, only about Rs 100 billion has gone into repayment of the principal component and the rest towards the interest obligation. The outstanding principal amount on these bonds is thus Rs 1.3 trillion. Most of these bonds will mature by 2024-25, imposing a heavy burden on current as well future governments.

 

An important part of the solution to the problem will have to be a focus on alternative energy sources. In 2015-16, coal and lignite accounted for 46.28 per cent of India’s energy consumption; crude petroleum for 34.48 per cent; electricity from hydro, nuclear and other renewable sources of energy for 12.75 per cent; and natural gas for 6.49 per cent.

 

Therefore the policy of the NDA government is to move towards renewable sources of energy. But one cannot readily switch between them and other sources of energy. To make our economy less dependent on oil will be a long-drawn-out process, which can be accelerated by supportive government policies. The Modi government is working on this long-term solution.

 

It is evident than in order to reduce our dependence on imported oil, we need to generate more energy from coal and lignite, which we have in abundance, and also focus on electricity generation from hydro and other renewable sources such as wind and solar. Since the government is focussed on having one GWh of installed solar capacity by 2022, we will see an increase in its share in the source-wise energy consumption in the years ahead. Until then economic prudence should override political expediency.

Vote-banks and foreigners

Opposition parties have sensed a chance after the release of the final draft of the NRC. Every attempt is being made to create a crisis where none exists. However, it is grossly premature to speculate on the future of those identified as illegal immigrants. Religion, region and caste have always affected politics but governance should be above such considerations.

A perfectly legitimate exercise by the Assam government, under the Assam Accord, has precipitated condemnable reaction from the Opposition parties. The Congress — and its president, Rahul Gandhi — must make its stand clear on the issue of illegal migrants from neighbouring countries. Both Indira Gandhi and Rajiv Gandhi had committed that immigrants to Assam after March 25, 1971, would be detected, identified and deported. The Congress had agreed to the NRC. But the party did nothing in this respect when it held office at the Centre or in Assam because the immigrants are mostly Muslims and the party has cultivated this community as its vote bank.

The Congress also tried to subvert the Foreigners Act 1946 through the Illegal Migrant Determination by Tribunal (IMDT) Act, 1983. The IMDT Act was stuck down by the Supreme Court in 2005. The Court’s verdict came in response to a petition filed by Assam’s current Chief Minister Sarbananda Sonowal. The court noted that the IMDT “is the main impediment or barrier in the identification and deportation of illegal migrants”.

The Congress’s conduct in the affair requires close scrutiny. In an affidavit filed before the Supreme Court on August 28, 2000, the then Asom Gana Parishad (AGP)-led government pointed out that it had been asking the Centre to repeal the IMDT Act because the law was against national interest. In May 2001, the AGP was defeated in elections to the Assam Assembly and a Congress-led government assumed office. On August 8, 2001, the new government moved an application in the apex court praying that the state be permitted to withdraw the earlier affidavit and be allowed to file a new affidavit. The application stated that “the IMDT Act is constitutional and there is no question of either repeal or striking down of the Act”.

The Atal Bihari Vajpayee-led NDA government at the Centre had filed an affidavit in the matter on July 18, 2000, stating that a proposal to repeal the IMDT Act was under its consideration. However, the Congress-led UPA government which assumed office at the Centre in 2004 file another affidavit in November that year. It said that the Centre had decided to retain the IMDT Act in its present form. But the Court stuck down the Act in 2005. It observed, “The dangerous consequences of large-scale illegal migration from Bangladesh, both for the people of Assam and more for the nation as a whole, need to be emphatically stressed. No misconceived and mistaken notions of secularism should be allowed to come in the way of doing so”.

It would not be an exaggeration to say that at the root of all socio-political problems in the country lie the Congress’s myopic politics. The party’s position on several issues, including the triple talaq issue, the Supreme Court judgment on maintenance to Shah Bano, illegal immigrants from Bangladesh, Ram Temple at Ayodhya and the plight of Kashmiri Pundits, testify to its myopic vision. The party is responsible for communalising Indian politics.

West Bengal Chief Minister Mamata Banerjee’s political ambitions have grown in recent times. She sees the NRC issue as an opportunity to consolidate her Muslim vote-bank. Banerjee has dishonestly described the NRC as a restriction on the inter-state movement of Indian citizens. She is trying to turn the NRC into a Hindu-Muslim issue. We hope she explains her stand on the issue of illegal migration from Bangladesh. It is another matter that on August 4, 2005, she had stated in the Lok Sabha: “Infiltration in Bengal has become a disaster now. You can see Bangladeshi as well as Indian names in the list. I have both the Bangladeshi and the Indian voters’ list. This is a very serious matter”. The silence of other political parties like the CPI, CPM, BSP, SP, RJD reeks of hypocrisy.

The illegal immigrants are not refugees. The movement under the banners of the AASU and AAGSP had emerged because the people of Assam feared the adverse social, political, cultural and economic impacts of the unabated influx of foreigners. Census figures show that the percentage of Assamese-speakers in the state declined from 58 per cent in 1991 to 48 per cent in 2001. The Muslim population of Assam increased from 25 per cent in 1951 to 34 per cent in 2011.

All political parties should express their stand on the issue of illegal immigrants in no uncertain terms. Fear-mongering and hyperventilation would not serve the interests of the nation as would keeping quiet on the issue.

Petroleum Prices, Why They Are So Important For Our Economy

By Gopal Krishna Agarwal

For understanding petroleum pricing in India: We have to break it into following aspects:

1.     Petroleum prices component

2.     Issues of under recovery and oil bonds during UPA

3.     Revenue to Central and State governments from the petroleum section.

      4.     Alternative Sources of energy and future planning for reduced dependence on oil

Petroleum products pricing is always a contentious issue. It has a large impact on inflation and also a major source of revenue for the Central and State governments, we import about 80% of our consumption needs. An increase of one dollar in the international price of crude oil increases the cost of our petrol and diesel by Rs. 0.50/ litre and one rupee fall in exchange rate against US dollar increase the cost by Rs 0.65/litre of petrol and diesel. We can conclude that the prices of petroleum products are determined in India by external factors. India imported 256.32 million metric tones of crude oil and petroleum products in 2017-18 and paid Rs. 6,52,896 lakh crore.

Earlier under Administered Price Mechanism (APM) followed by UPA, petrol and diesel prices were not market determined.  Steep increase in international prices of oil used to put severe pressure on the oil marketing companies (OMC). Still their retail prices were kept below the cost, resulting in under-recoveries for OMCs. Between the year 2004 to 2014, the total under-recoveries was to the tune of Rs. 8,53,628 crores.

When the international crude prices were increasing, during the period of 2004-08 the subsidy by the government on petroleum products became insufficient. Since the fiscal position of the Government was very bad, there was no scope for increasing the subsidy. The government started issuing ‘oil bonds’ to the OMCs instead of giving cash subsidy. These interests bearing Oil bonds were not even reflected in the Budget provision by the UPA Government, resulting in distortion of fiscal deficit figures. During 2005 to 2010, oil bonds for Rs. 1,42,202 crore were issued,

with rate of interest on them ranging from 7.33 to 8.4 % per annum repayable up to 2024-25 by successive governments in the future. This was a case of postponing current liabilities on the future generation.

Bad fiscal prudence under UPA government resulted in increasing of the interest rates affecting borrowing and investment in the economy and higher inflation for the common men. While the petrol and diesel prices were artificially kept low, people were paying higher prices for almost every other thing. The burden sharing mechanism devised by the UPA government had also led to a depletion of cash reserves of oil companies like ONGC, GAIL and OIL and destruction of their intrinsic market value.

The argument that high taxed on petroleum product in India needs to be brought down to control the spiraling prices has to be closely looked into.

Firstly, this revenue is required for catalyzing India’s economic growth, for building infrastructure for better quality of life and providing social security to the poor classes and in the backward areas. Secondly, large component of Central government duties on petroleum products i.e. 42% of the Basic Excise Duty is given to State governments and 60% of the balance 58% of the Basic Duty is spent on Centrally Sponsored welfare schemes in the States i.e. total amount transferred to the States by the Centre is (42+34.8)= 76.8 % of the Basic Excise Duty. It is also estimated that a one rupee reduction in the excise duty at the Centre would reduce revenue collection by Rs 14,000 crores.

Increase in the petroleum prices has different effect on the tax collected by the Centre and the States, which also has to be analyzed properly. In a decontrolled regime now being followed in India, any change in international crude price is passed on to the consumer. Higher prices are likely to reduce consumption. The taxes imposed by the Centre are specific tax, i.e., fixed in terms of Rs per unit. So, if the consumption falls, the tax collected by the Centre goes down. The States, however, levy ad valorem taxes i.e. percentage based on prices and therefore with the increase in petroleum prices, its tax collection does not fall even with fall in consumption. Therefore, if the taxes on petroleum products have to be reduced in wake of the rising international prices, it should be done by the States first than by the Centre.

The solution to this teething problem on the long-term basis, is to change the share of petroleum products in energy consumption mix (34.48%, year 2015-16) We need to generate more energy from coal and lignite (46.28%), which and also focus on electricity generation from hydro, nuclear and other renewable sources like wind and solar (12.75%).

Shri Narendra Modi government is working on this line. In the coming years we will definitely see a fall in the contribution of petroleum products in the overall energy share in our consumption.

विकास के लिए जरुरी है तेल

 विकास के लिए जरुरी है तेल

गोपाल कृष्ण अग्रवाल,

पेट्रोलियम उत्पादों की कीमत हमेशा से ही एक विवादित मुद्दा रहा है। एक तरफ घरेलू मुद्रास्फीति पर इसका बड़ा असर पड़ता है और दूसरी ओर यह केंद्र और राज्य के लिए राजस्व का एक प्रमुख स्रोत है। तेल पदार्थ के उपभोग की आवश्यकताओं के लिए 80 फीसद से अधिक हमारी आयात पर निर्भरता इसकी कीमतों को निर्धारित करने की हमारी क्षमता को काफी कमजोर करती है। एक डॉलर कच्चे तेल की अंतरराष्ट्रीय कीमत में वृद्धि से भारत में पेट्रोल और डीजल की कीमत में रुपये 0.50 प्रति लीटर की बढ़ोतरी होती है और अमेरिकी डॉलर के मुकाबले भारतीय रुपये की विनिमय दर में गिरावट से भारत में पेट्रोल और डीजल की कीमत में रुपये 0.65 प्रति लीटर की वृद्धि होती है। इस प्रकार पेट्रोलियम पदार्थ के मूल्य निर्धारण में हम माहरी कारकों पर ही अधिक निर्भर है।

2004-08 के दौरान अंतरराष्ट्रीय बाजार में कच्चे तेल की कीमतें तेजी से बढ़ रही थीं, पेट्रोलियम उत्पादों की कीमतों को कृत्रिम रूप से कम करने के लिए सरकारी सब्सिडी अपर्याप्त साबित हो रही थी। चूंकि यूपीए सरकार की वित्तीय स्थिति पहले से ही खराब थी, इसलिए वह नकद सब्सिडी के स्थान पर ऑयल मार्केटिंग कंपनियों को तेल बांड जारी करने के वैकल्पिक का सहारा लिया। तेल बांड के मूल धन एवं ब्याज राशि भी सरकार द्वारा बजट प्रावधान में नहीं दधाए गए जिसकेपरिणामस्वरूप बढ़े हुए राजकोषीय घाटे का कृत्रिम मूल्यांकन हुआ। 2005-06 और 2009-10 के बीच सरकार द्वारा 1,42,202 करोड़ रुपये के तेल बांड जारी किए गए थे, जिनकी ब्याज दर 7.33 से 8.4 फीसद थी। इस राशि को ब्याज सहित भविष्य की सरकारों द्वारा 2024-25 तक चुकाना था।

इस खराब वित्तीय स्थिति ने आर्थिक स्तर पर ब्याज दरों में काफी बढ़ोतरी की और सामान्य जन के लिए महंगाई की मुद्रास्फीति को बढ़ा दिया। इस प्रकार लोग कृत्रिम रूप से कम कीमत पर पेट्रोल और डीजल प्राप्त तो कर रहे थे, लेकिन वे लगभग सभी चीजों के लिए अधिक कीमत भी चुका रहे थे। यूपीए सरकार द्वारा तैयार इस तंत्र ने सरकारी तेल कंपनियों की आर्थिक स्थिति खराब कर दी।

दूसरा तर्क है कि भारत में पेट्रोलियम उत्पादों पर अत्यधिक कर लगाया गया है में और उन्हें बढ़ती कीमतों को निर्यात्रत करने के लिए नीचे लाया जाना चाहिए। पहले तो भारत के आर्थिक विकास, बेहतर जीवन के लिए , आधारभूत बुनियादी ढांचे का निर्माण और गरीब वर्गों और पिछड़े क्षेत्रों को सामाजिक सुरक्षा प्रदान करने के लिए इस राजस्व की जरूरत है। दूसरा, पेट्रोलियम उत्पादों पर केंद्र सरकार के करो का एक बड़ा हिस्सा; - मूल उत्पाद शुल्क का 42 फीसद राज्य सरकारों को दिया जाता है और शेष कर राशि 58 फीसद का भी 60 फीसद (यानी 34.8 फीसद) केंद्रीय प्रायोजित कल्याण योजनाओं पर खर्च के लिए प्रदेश सरकार को दिया जाता है। इस प्रकार राज्यों में स्थानांतरित कुल राशि 76.8 फीसद है। सरकारी अनुमान है कि केंद्र द्वारा पेट्रोलियम पदार्थ पर उत्पाद शुल्क में 1 रुपये की कटौती से उसका राजस्व संग्रह 14,000 करोड़ रुपये कम हो जाएगा।

केंद्र और राज्यों द्वारा एकत्रित कर पर पेट्रोलियम की कीमतों में वृद्धि का असर स्पष्ट रूप से समझा जाना चाहिए। केंद्र द्वारा लगाए गए कर, प्रति यूनिट के आधार पर तय किए गए है। इसलिए यदि खपत गिरती है तो केंद्रीय कर कम हो जाता है। राज्य, मूल्यानुसार कर लेते हैं जिससे पेट्रोलियम की कीमतों में वृद्धि के साथ, इससे कर की मात्रा बढ़ जाती है। इसलिए बढ़ती अंतरराष्ट्रीय कीमतों के चलते पेट्रोलियम उत्पादों पर करों को केंद्र की तुलना में राज्यों को अधिक कम करना चाहिए।

हमें इस कठिन समस्या का दीर्घकालिक समाधान भी खोजना जरूरी है जिसके लिए हमें ऊर्जा खपत मिश्रण में पेट्रोलियम उत्पादों के हिस्से (34.48 फीसद, वर्ष 2015-16) को बदलना होगा। हमें कोयले और लिग्नाइट (46.28 फीसद) से अधिक ऊर्जा उत्पन्न करने की जरूरत है, जल, सौर, हाइड्रो, परमाणु व अन्य नवीकरणीय स्रोतों (12.75 फीसद) से अधिक बिजली उत्पादन पर ध्यान केंद्रित करने की जरूरत है। मोदी सरकार इस दीर्घकालिक समाधान पर काम कर रही है और आने वाले वर्षों में जब इस स्रोतों से ऊर्जा मिलने लगेगी तो पेट्रोलियम उत्पादों के उपयोग में अपने आप गिरावट देखी जाएगी।

(भाजपा के राष्ट्रीय प्रवक्ता)