The YSR Congress Party today asked the UPA II Government at the Centre to immediately roll back the diesel prices which came into effect since midnight last night. Party Political Affairs Committee Member D A Somayajulu told reporters here that the decision of Government of India to increase the diesel prices by Rs five per liter at this point of time was bound to adversely impact the already ailing Indian economy, with the inflation likely to sky-rocket shortly.
He said the decision to restrict the subsidy on gas cylinders to just six per annum would also very adversely affect the budgets of middle class and the poor. The Government’s argument that they were compelled to increase the prices because of global price increases was not correct, he said, adding the main factors responsible for the present state of Indian economy were the policy paralysis and governance paralysis, which have been in evidence during the last four years of UPA Government.
Mr Somayajulu said the Trade Deficit of the country has gone up from $ 20 billion in 2005 to $ 185 billion in 2012. The Current Account Deficit that deals with foreign exchange has gone upto 4.5 per cent of GDP as against Current Account Surplus in 2008.
As a result of it, the rupee has substantially devalued against USD, the parity having gone Rs 40 per USD in 2009 to Rs 60 per one USD in 2012.
The YSRCP leader also said the landed prices of crude in rupee terms have gone up despite the international prices of petroleum coming down. The international prices of petroleum crude are based on daily trading in NYMEX, he said the cost of petroleum crude as on July 4, 2008 was $ 145 per barrel of 159 litters.
The international prices have since fallen and the cost of one barrel as on September 13, 2012 is $ 97 ( $ 48 less per barrel than what it was 4 years ago).
Because of the reluctance on the part of UPA Government in resolving several key economic issues, the GDP growth rate of the country fell almost to 5 per cent, impacting the revenue growth adversely.
The fact that revenue growth in 2011-12 was just 10.66 per cent as against previous year’s 25 per cent is clear proof of mismanagement of the economy by the UPA Government.
“We demand that the diesel price hike be rolled back along with the restriction on subsidized gas cylinders,” Mr Somayajulu said. UNI