[finneyp]

It is just some recommendation by some committee!

Govt won't dare to accept the same!

[abhinav.gupta88]

Even in Dubai Deisel is expensive than petrol!

I dont think this will help congress anyway with the elections so close!

[Karandeep81]

doubt it !!! would have been possible if the companies were private

[Thad E Ginathom]

Even in UK Diesel is more expensive than petrol!

It carries higher taxes.

I think supremeBaleno makes good points. Car ownership has exploded in last few years: is it reasonable to expect government to subsidise the fuel costs? See all the new cars; should the government be contributing to their travel costs?

Lets keep the state-owned fuel companies, and lets not make them profit-oriented, but there should be better ways of targeting subsidy: this one seems to favour the rich!

[ph03n!x]

Originally Posted by supremeBaleno

And while they are at it, maybe they should also hike diesel prices monthly so that by Mar09, it becomes on par with petrol, like it is in most parts of the world.

Hey! That is totally uncalled for!

Public transport will be costlier. Commodities will be costlier. Inflation will shoot up, so will my fuel bill !!!

[phamilyman]

For the last time for love of God, those cribbing of current crude prices, please ever bother to derive actual market rates versus mandated rates. Actual prices would definitely be higher.

And yes, inflation it will cause, but it'll also improve things going forward, and kill the nano. else diesel nanos will rule while stupidly petrol will be sky high

[mjothi]

I am with you SB. The diesel price should be at par with Petrol. (Atleast for non-commercial usage) But I wonder how can they make this happen.

Waiting for the Toyota Priux and other hybrid cars to be in reach around 10Lacs

I know I expect too much, but unless govt promotes alternative source, the dependcy will never reduce.

One more to add here is, the lines of cars that follow the political leaders vehicle in the name of security, loyaltist, party men or whatever they are called. Reduce these and see how much consumption is reducing.

One thing I dont understand is, Oil price has reduced almost 30$ and govt talks about increasing the prices again. Ummm, Mera Bharat Mahan....

[supremeBaleno]

Quite a benign and rational response. I was expecting to see some strong opinions.

Originally Posted by rranjith_kum

Just one doubt isn't the Nymex crude sliding to prices below 118 $ so it will be a profit for these state owned companies right ?

Originally Posted by mjothi

One thing I dont understand is, Oil price has reduced almost 30$ and govt talks about increasing the prices again.

Well, even when the price was hiked by Rs.5 for petrol (and Rs.3 for diesel) when oil was around 130$ or so, it did not really make up for the huge hike from 80$ where oil was trading. So, it is not like, the petro-companies are going to see profits when oil price has now gone down to 118$.

Originally Posted by amohit

2009 being the election yr..i doubt anything will happen.

Originally Posted by Fountainheader

And I doubt the Congress would like such moves so close to the elections.

Originally Posted by abhinav.gupta88

I dont think this will help congress anyway with the elections so close!

I was not implying that this will happen. Infact given the way things work in India, the recommendation will most probably end up in the trash-bin. The idea was only to have a realistic look at where we are headed.

Originally Posted by Thad E Ginathom

Car ownership has exploded in last few years: is it reasonable to expect government to subsidise the fuel costs? See all the new cars; should the government be contributing to their travel costs? but there should be better ways of targeting subsidy: this one seems to favour the rich!

Yes, in the name of subsidising the poor, affordable public transportation and keeping inflation in check, we are actually subsidising the rich who if they have the means to buy a car, should also factor in the cost of buying gas for it. Especially with diesel vehicles, we are unnecessarily subsidising the affluent middle-class and the upper classes with their steeds ranging from the Swift-D at the low-end to the Mercs and BMWs in the top segment. Don't really see a need to use public money to fund part of their transportation costs.

Originally Posted by ph03n!x

Public transport will be costlier. Commodities will be costlier. Inflation will shoot up, so will my fuel bill !!!

I bet you really dont use public transportation in the city and I am sure the costlier commodities and inflation increase is not really going to kill you like it would do to the common man. The 4th reason you mentioned is what you are really worried about.

Originally Posted by phamilyman

For the last time for love of God, those cribbing of current crude prices, please ever bother to derive actual market rates versus mandated rates. Actual prices would definitely be higher.

Yes, a very valid point.

Originally Posted by mjothi

The diesel price should be at par with Petrol. (Atleast for non-commercial usage) But I wonder how can they make this happen.

This is the need of the hour, but very tough to implement when you think in terms of having different prices for different usage because then the loopholes will be exploited. Only way (though a hard measure) is to progressively remove the subsidies and bring prices to real level, for any kind of usage. Yes, inflation will rise. Yes, public transportation will become costlier. But also adulteration will go. So will wasteful usage of these resources.

Originally Posted by mjothi

One more to add here is, the lines of cars that follow the political leaders vehicle in the name of security, loyaltist, party men or whatever they are called. Reduce these and see how much consumption is reducing.

Well, initiatives should start from the top, which is only when the public will emulate them. But given the crooks we have for politicians, hell will freeze over before these guys think beyond themselves. And we are also to blame - for as is said, a people get the leaders they deserve.

[Ricky_63]

If Deisel prices increase it will have a cascading effect on prices of commodities across the board...from the food you & I eat to the airconditioners we use. Transportation cost effects EVERYTHING.

The total consumption of deisel for private car usage is a minusicle % of the total deisel sold in India.

Power Backup which we in India need as almost a necessity is dependant on deisel.

There is no public transport to speak of in say Gurgaon, everyone has to own a private vehicle & a standby to be able to commute. It is a kind of pre-condition if you live in Gurgaon. Delhi is only slightly better, though there is public transport, it leaves a lot to be desired.

Lastly, I remember a tax called the "Gulf War Tax"...the war ended long back but the Tax was never removed - why ?

If we have good roads for which we tax-payers pay thru our noses, we would have better traffic management. Better traffic management will minimize jams, the amount of fuel we waste in jams could very easily be saved, thereby bringing down fuel requirement of the country.

Good roads + no jams = lower fuel consumption

An article in yesterdays paper said a road which costed 25 lacs to build last year has been repaired 5 times and the repairs have costed 45 Lacs. That speaks volumes of the quality of roads.

Just a few of the observations. If the tax-payers money actually goes where it needs to - I believe we would be FAR better placed as a nation than we are today.


P.S. Pardon some of the OT points





Cheers

[mjothi]

Probably they can make Diesel on par with petrol and provide some Income Tax rebates for those commercial bodies. I know this may also have several loopholes, but atleast, everyone will start filing returns to get the rebate and hence easier to track too

[PhrozenFire]

While there could be endless debates and discussions on this topic, some of which would lead nowhere really, like all the good economists of the world are doing currently . A few things I would like to say here
1. Price increase will encourage greater use of public transport, which is good for the clogged roads and environment.
2. Diesel should be brought on par with petrol, like it is the world over. But with the elections scheduled for next year, I dont see this happening.
3. Politicians, firstly, should start contributing by decreasing the no. of vehicles in their convoys, which sometimes run into 20-30 in number. That many cars are absolutely unnecessary. I think 4-5, if that, would do just fine. Politicians just use it as another tool to show off their power, besides it leading to clogged roads and more wasted fuel.
4. And on a lighter note, I sure hope the price rise doesn't stop the T-Bhp meets . At least we're safe till the next elections!

[supremeBaleno]

Originally Posted by Ricky_63

If Deisel prices increase it will have a cascading effect on prices of commodities across the board...from the food you & I eat to the airconditioners we use.

No one is denying that fallout of removing fuel subsidy. But then how long can we keep prices artificially down in the name of price-rise, while the subsidy gets misused by those for whom it is not intended ?

Originally Posted by Ricky_63

The total consumption of deisel for private car usage is a minusicle % of the total deisel sold in India.

Maybe miniscule today, but growing by the day, as is evident by the long waiting period for the Swifts and Dzires. Not to mention the yet to be launched Nano-D.

Originally Posted by Ricky_63

Power Backup which we in India need as almost a necessity is dependant on deisel.

Maybe the nuclear deal will help us in this regard. If not, we need to think of other sources (solar, wind, tides etc), because diesel is not going to be there for ever.

Originally Posted by Ricky_63

There is no public transport to speak of in say Gurgaon, everyone has to own a private vehicle & a standby to be able to commute. It is a kind of pre-condition if you live in Gurgaon. Delhi is only slightly better, though there is public transport, it leaves a lot to be desired.

How about car pooling instead of each person driving his own car ? It will offset the extra cost you pay for the fuel subsidy being removed. And ofcourse, this also needs Govt. initiative in the form of improving/adding public transportation.

[suvi]

The price parity between Petrol and Diesel can be brought only if crude slips to say $70 per barrel. An easier proposition will be to put a higher excise and road tax for the diesel cars compared to petrol ones thereby making the car owners pay "correct" price of diesel without raising inflation for the common man.

[esteem_lover]

Denmark's example is perfect. but will it work in India ?? No wayy!! As long as they sell petrol, our nouveau rich man will take his car/SUV out. It takes a huge effort to remove certain mental blocks. Madan80 has to be applauded for his efforts, he has already started cycling to work.

[supremeBaleno]

Originally Posted by esteem_lover

It takes a huge effort to remove certain mental blocks.

Well, if we don't take the effort on our own, the best remedy the doc would suggest is a pill in the form of a huge price hike. That should help in removing mental blocks.

Ofcourse, for others (like madan98.3), change comes from within, the Zen way.