[snkjr]

Originally Posted by samarjitdhar

While this looks so beautiful on paper who is updating this data? It is the distributor who is sending this data based on which this data shows up. It may be very well that one day I suddenly see that I have consumed all the 6 cylinders of my subsidy quota while I only ordered 1. Where is the power in my hand to have such corruption redressed?

The power really is in your hands - in your gas card/book entries and the cash receipts that you get for every delivery.

[RS_DEL]

Originally Posted by samarjitdhar

While this looks so beautiful on paper who is updating this data? It is the distributor who is sending this data based on which this data shows up. It may be very well that one day I suddenly see that
salivating at the buck they will make by diverting the subsidized cylinders in the black market.

I just asked my wife about this. She orders LPG refills via a telephone # registered with the company's servers on an IVR that is linked to the company's servers. So to me it does seem monitor-able. Without a doubt there will be cases of the dealers committing fraud, but as more and more the process is automated there will be decreased scope for wrongdoing.

[apachelongbow]

Originally Posted by samarjitdhar

While this looks so beautiful on paper who is updating this data? It is the distributor who is sending this data based on which this data shows up. It may be very well that one day I suddenly see that I have consumed all the 6 cylinders of my subsidy quota while I only ordered 1. Where is the power in my hand to have such corruption redressed?

As long as you have your gas passbook, and its relevant entries, the distributor cant shunt your subidised cylinder to someone else. He may show any kind of data, however how can he forge entry into the passbook held by you?
Its interesting to know what happens in case of piped gas. How much quantity of gas is subsidised?

[Hayek]

Originally Posted by apachelongbow

As long as you have your gas passbook, and its relevant entries, the distributor cant shunt your subidised cylinder to someone else. He may show any kind of data, however how can he forge entry into the passbook held by you?
Its interesting to know what happens in case of piped gas. How much quantity of gas is subsidised?

Piped gas is regulated, but not subsidised. It's domestic natural gas, which is difficult to sell to third parties. But expect those prices to rise rapidly as domestic gas from Bombay High runs out and is substituted by either KG basin gas (assuming it exists) or LNG.

Originally Posted by snkjr

The power really is in your hands - in your gas card/book entries and the cash receipts that you get for every delivery.

Fantastic move by the OMCs. The only way to circumvent this is by creating fake customers (BTW, when I went through the list for my distributor, there did seem to be obvious cases of commercial diversion - eg chawl residents who have used 9 cylinders in 6 months). But this can be combined with a UID requirement for all LPG customers to create a much better way to target subsidies. This is a small step in the right direction - I don't see why people like me need to be subsidised even by Rs. 2100 per year.

Note from the Team-BHP Support: Please use the EDIT or MULTI-QUOTE buttons instead of typing one post after another on the same thread.

[drmohitg]

Originally Posted by apachelongbow

Aha! And now our members have started saying 'Finally some sense" and "I am ok with this fuel hike". Friends it not just a hike of Rs 5/liter which you fill in your tanks. This Rs 5 hike means a hike in everything you and I pay for. Wait and watch! See how transport, food, vegetables, goods, resturants, cab services, water tanker services etc etc will flash hike their rates. I estimate about a 15-20% immediate increase in monthy household budgets. With an expected hike of approx 10% on an average, every Indian will pay 10% more to just exist.

But then what do you suggest as a solution. Everyone ( mostly petrol car owners) have been cursing the govt for quite some time now, not for increasing the petrol prices, but for not touching the diesel prices. So now the govt has increased that too and the general sentiment is that of welcoming this bold move. it was always a known fact that an increase in diesel prices would increase prices of everything that we consume. But then many a people on the forum have said before that this might be a false impression and the long term effect are good for the economy and won't disturb inflation much.

Originally Posted by Vid6639

People will still buy diesel cars only to see lower expenses when they fuel up but that doesn't mean that every diesel car owner is at an advantage. He might have really stretched to fit in a diesel and it may not even pay off for him.

Actually this is very true. Infact it makes me sometimes believe that the govt may overall be benefiting from the shift to diesel vehicles since the tax collected is more ( owing to a higher Ex-showroom price). The gains may actually be sufficient enough to compensate for any losses made in subsidizing diesel. Most of the people I know in my family and friends have shifted to a diesel car. The only ones driving a petrol vehicle are the ones who haven't changed there ride for the last 5 years. And almost 80% of these diesel car owners do not drive for than 1000 kms a month. It is the same mundane 10-15 km drive to and from the office everyday for them. Or the cars serves as a spare car to ferry the children to school and other random chores. My neighbour has a cruze which has covered only 5000 kms in its 9 months of ownership so far and continues to decorate the parking place most of the time.

Regarding LPG cylinders: In Delhi they are already shifting to gas pipelines at a very frantic pace. They have already made this change in most apartments and residential areas. This ensures there is no subsidy going to the consumer anyways. So the 6 cylinder rule would not hurt people much. Isn't this being followed in other cities too?

[sanchari]

In Bangalore, with our HP LPG distributor, we cannot book a cylinder for 30 days after the previous one was delivered. So there was already a kind of limit to 12 cylinders per year.

What prevents people from creating accounts with husband, wife and children's names? Even UID cannot prevent this. They will have to look at house addresses, and I don't know if they can match the addresses so accurately, given there are multiple floors in many houses, old style group of houses with same address etc.

Regarding the hike in diesel prices, yes, it does have an impact across the board. However, the taxes (both state & Central) are already greater than 30-35% for both diesel and petrol. The governments should bring down the taxes to realistic level too.

[mjothi]

Originally Posted by apachelongbow

As long as you have your gas passbook, and its relevant entries, the distributor cant shunt your subidised cylinder to someone else. He may show any kind of data, however how can he forge entry into the passbook held by you?

Seriously, I am wondering how many gas dealers are really "updating" your gas book. I have not seen anyone in Bangalore or Chennai atleast. They use to, but now almost nil. They just provide the bill.

[souravc]

I welcome the price hike simply because that's the best case scenario for our economy else I think we were surely heading towards a catastrophic downgrade to sub investment grade .

As quite a few have rightly raised questions on the LPG pricing and how its going to be monitored - i feel that this half hearted measure opens further avenues for corruption . Bite the bullet and remove subsidy for LPG altogether - subsidised LPG only for those who have BPL or some special card, that should have been the rule. The current measure will result in untraceable leakage - in case its linked to cards , the fraud or wrong doing can be traced to an individual.

Originally Posted by RS_DEL

I just asked my wife about this. She orders LPG refills via a telephone # registered with the company's servers on an IVR that is linked to the company's servers. So to me it does seem monitor-able. Without a doubt there will be cases of the dealers committing fraud, but as more and more the process is automated there will be decreased scope for wrongdoing.

Originally Posted by apachelongbow

As long as you have your gas passbook, and its relevant entries, the distributor cant shunt your subidised cylinder to someone else. He may show any kind of data, however how can he forge entry into the passbook held by you?

I have been ordering LPG gas online since the last 4 years and it has happened so many times where the online status shows that the cylinder has been delivered while I have not got it - burden of proof lies on whom ? Monitoring this is not going to be easy .

@RS_DEL - Give some more thoughts to your comment on the automobile industry and how it is not important for any economy - its far from the reality that we live in . Its one of the largest job creators in the economy , a huge foreign exchange earner , a large driver of domestic demand - so for our economy its survival is sacrosanct ! Why do you think US and Europe pushed through a "cash for clunkers" scheme? There can't be 2 ways about the importance of the auto industry . A basic truth is that India does not have adequate resources to afford a credible infrastructure to support alternate fuel so till such time we are able to afford it we cannot be careless about fossil fuel automobile industry .

[RS_DEL]

Originally Posted by souravc

I welcome the price hike simply because that's the best case scenario for our economy else I think we were surely heading towards a catastrophic downgrade to sub investment grade .

@RS_DEL - Give some more thoughts to your comment on the automobile industry and how it is not important for any economy - its far from the reality that we live in . Its one of the largest job creators in the economy , a huge foreign exchange earner , a large driver of domestic demand - so for our economy its survival is sacrosanct ! Why do you think US and Europe pushed through a "cash for clunkers" scheme? There can't be 2 ways about the importance of the auto industry . A basic truth is that India does not have adequate resources to afford a credible infrastructure to support alternate fuel so till such time we are able to afford it we cannot be careless about fossil fuel automobile industry .

In the current scenario without the appropriate infrastructure Alternative energy powered mobility at an individual level is NOT a realisitc possibility/alternative so I am not even suggesting that.

My stand on this issue is if we need mobility at the personal level it has a cost. If the automotive industry as it stands today can help us deliver a solution where the cost is viable, it will survive. If the automotive industry can not do so, it's demise is certain. I would go on to suggest it should be allowed to die. Only if it's very survival is at stake will we see efforts at solutions that will make sense. I am not referring to any particular fuel here be it diesel or petrol or CNg. If tomorrow fossil fuel prices start going up, as some suspect they will, what then? We start subsiding the auto companies? From the frying pan into the fire?

[AlphaKilo]

Originally Posted by apachelongbow

Wonderful government and wonderful policies!!! Are these people actually brainless morons or have they become so smug thinking that no matter what, common man will not react!!

PS: On a personal level, this fuel hike doesnot impact me. However I refuse to pay more on all related/unrelated services (almost an extortion) because or esteemed government is powerless to stop this price rise.

I vehemently condemn your statement . You "Middle class" don't bother paying INR 20 for "Mineral water" but if petrol/diesel is hiked, you go hoo haah.

Disclaimer: The above is not my statement and I am sure everyone knows, who is the owner of the above statement and what position he holds now.

How can the fuel hike not impact you, when a kg of tomato/onion/vegetables/meat is going to cost now 15-50% more than yesterday? A simple 2 kms auto journey will now cost more, irrespective of the fact that auto runs on petrol and gives a mileage of over 25kmpl! How can this not affect you sir?
I am sure sooner or later, the truck owners association will announce a nation wide strike, helping the price rise. Once the Govt. rolls back the fuel price hike, the other hiked prices will stay! Who will strike for the roll back of commodity price? Can we go on a hunger strike, saying we will not buy vegetables/meat/food untill prices are rolled back? Its a catch-22 situation for a "Mango(aam) Aadmi", so govt. has the upper hand here. Either stand-up and fight(no violence/protests rather, vote intelligently in the next election!) or go with the wind. We don't have so many choices in the worlds largest democracy!

[Hayek]

Originally Posted by Vid6639

People will still buy diesel cars only to see lower expenses when they fuel up but that doesn't mean that every diesel car owner is at an advantage. He might have really stretched to fit in a diesel and it may not even pay off for him.

Deregulation of diesel will only kill the automobile industry which are already in a coma for the past few months.

I'm all for the price hike but this has to stop somewhere. Govt. is just looking at all places to tax the public.

I agree with you to the limited extent that a lack of consistency in policy makes it difficult for both customers and the industry to decide what products to buy or make. There used to be a pretty clear benchmark at about 15,000-20,000 km per year usage to justify diesel cars - that was valid when I bought my petrol Superb in 2010, it has gone wonky in the last two years. This corrects the distortion slightly but you will still have people with less than 10,000 km usage buying diesels.

But the fact is that we cannot afford the massive diesel subsidy, and it has to go if India has to remain viable. For those cribbing about taxes, lets be clear - tax revenue covers just 55% of the GOI's on budget expenses (excluding the off budget costs on subsidies incurred by ONGC et al), so unless the government reduces its spending drastically, taxes would have to rise. In an ideal world, schemes like NREGA would end, diesel and petrol would both be taxed moderately (say 25% combined state and central taxes), LPG taxed at zero and kerosene users given a cash subsidy. That would give us diesel prices of about Rs. 65 per litre and LPG prices of Rs. 700 per cylinder, reduce inflation, allow the RBI to cut rates and give us a chance of returning to 7-8% growth.

This step helps avert an immediate crisis but more needs to be done

[apachelongbow]

Originally Posted by AlphaKilo

I vehemently condemn your statement . You "Middle class" don't bother paying INR 20 for "Mineral water" but if petrol/diesel is hiked, you go hoo haah.

Disclaimer: The above is not my statement and I am sure everyone knows, who is the owner of the above statement and what position he holds now.

How can the fuel hike not impact you, when a kg of tomato/onion/vegetables/meat is going to cost now 15-50% more than yesterday? A simple 2 kms auto journey will now cost more, irrespective of the fact that auto runs on petrol and gives a mileage of over 25kmpl! How can this not affect you sir?

Don't worry, I wont mistake the Moron's statement for yours If that moron got his looted 94000 crores back to India, we wudnt have this conversation in the first place.

OT apart, yes this hike doesnt affect me, as it it wouldnt make me adopt any life altering changes. Max what will happen, I may visit the mall/movies/dinner less often, leading to the loss of those people. May be i will not drive down for a late night icecream, but well, its better for the environment that I drive less.
I have my costs under control, and I can reduce non essential spending without it touching my core lifestyle. I dont trust this corrupt govt, and I am making my own arrangements for a secure future, no matter if this govt or this country exists tomorrow or not.

What I am worried about is the common man, truly, example my driver, my security guard, my car washer and so on. How will they be able to 'bear' this price hike? I can do whatever I can, in terms of giving them more salary/allowance etc, but to a limited point. This is not what we elected this govt for!!

[Vid6639]

Originally Posted by Hayek

But the fact is that we cannot afford the massive diesel subsidy, and it has to go if India has to remain viable. For those cribbing about taxes, lets be clear - tax revenue covers just 55% of the GOI's on budget expenses (excluding the off budget costs on subsidies incurred by ONGC et al), so unless the government reduces its spending drastically, taxes would have to rise. In an ideal world, schemes like NREGA would end, diesel and petrol would both be taxed moderately (say 25% combined state and central taxes), LPG taxed at zero and kerosene users given a cash subsidy. That would give us diesel prices of about Rs. 65 per litre and LPG prices of Rs. 700 per cylinder, reduce inflation, allow the RBI to cut rates and give us a chance of returning to 7-8% growth.

This step helps avert an immediate crisis but more needs to be done

I really don't think that removal on diesel susidy is the sole reason to make a country viable. There are too many other factors and diesel was picked solely because the govt. realised that they were missing out on a huge cash cow till now.

Anyways, let's not go too much into politics lest we go too OT and the mods take notice.

[souravc]

Originally Posted by RS_DEL

My stand on this issue is if we need mobility at the personal level it has a cost. If the automotive industry as it stands today can help us deliver a solution where the cost is viable, it will survive

Lets take a step back - why do we seek mobility at a personal level so desperately when people in cities like Singapore / HK / London happily survive without it . If the govt can't provide proper public transportation (not the over-crowded Mumbai local kind) and the peripheral infrastructure associated with it , its the govt's duty to lend a helping hand if the situation so demands.

Originally Posted by RS_DEL

If the automotive industry can not do so, it's demise is certain. I would go on to suggest it should be allowed to die. Only if it's very survival is at stake will we see efforts at solutions that will make sense. I am not referring to any particular fuel here be it diesel or petrol or CNg. If tomorrow fossil fuel prices start going up, as some suspect they will, what then? We start subsiding the auto companies? From the frying pan into the fire?

Just like we should stop subsidising & support to the following industries too ?
1. IT & ITES - Massive Tax subsidy
2. Textile - Duty drawback
3. Iron & Steel - Anti-dumping duty support, capital subsidy. If the Indians cannot make cost effective steel so be it , let the Chinese dump better steel at cheaper rates
4. Power - Coal subsidy , capital subsidy , tax holiday
etc

Where do we go from there ? Can you imagine the job losses ? Its a very real economy , not a funky bank or stock market trading transaction which makes paper profits / commissions .

Any industry needs a stable regime and the same holds true for automobile industry too - more so given that its requires huge capex investments . The need of the hour is a firm policy direction and gradual movement towards it- one cannot have issues such as the penal tax on diesel cars hanging on for months .

[samarjitdhar]

On another note its sad to see that some of us feel the presence of middlemen who provide no real value to any supply chain apart from fattening their own pockets by their very existence, essential and beneficial to the market. All they have done is multiplied the price of commodities 10 times from the cost of production + profits to my end use. They have been manipulating prices and markets for years and have also managed to introduce intelligent sounding arguments which practically mean nothing to confuse the common citizen about the need of their existence.

Originally Posted by snkjr

The power really is in your hands - in your gas card/book entries and the cash receipts that you get for every delivery.

Originally Posted by RS_DEL

I just asked my wife about this. She orders LPG refills via a telephone # registered with the company's servers on an IVR that is linked to the company's servers. So to me it does seem monitor-able.

Originally Posted by apachelongbow

As long as you have your gas passbook, and its relevant entries, the distributor cant shunt your subidised cylinder to someone else. He may show any kind of data, however how can he forge entry into the passbook held by you?

Originally Posted by mjothi

Seriously, I am wondering how many gas dealers are really "updating" your gas book. I have not seen anyone in Bangalore or Chennai atleast. They use to, but now almost nil. They just provide the bill.

Let me address all the above by demonstrating a simple scenario. At the outset let me tell you that I am very well aware of the current booking process and the flaws in it. Hope no unscrupulous LPG distributor reads this. Currently the phone booking system is the only mass accepted way to book the refills. Most of India is not computer literate so I am not considering the online booking system.

In my household the gas cylinder is in my name so when this system was introduced I registered using my consumer no. and phone no. I was happy with it. I was first scared when my wife could also register with the same consumer no. and her own cell phone no. even though the connection is in my name. Which means anybody who has my consumer no. can make a booking now for a refill against my no. by using a different telephone no. This access control is totally flawed and without fixing this the news of this cylinder limit have the distributors salivating.

Distributor 1 - Consumer 0

Now under this new system lets say I have used only 1 subsidized refill till now. But my corrupt LPG distributor knows he/she can place the order using any telephone no. and he/she does that to order the rest of the 3/4 refills. Since he/she is part of the supply chain system he/she knows when the refill will be allotted and he/she can easily pilfer that in the black market. When this subsidy limit was not there he/she had no incentive to run this process however they did according to newspaper reports I have read. The corrupt distributors currently scan household LPG usage patterns and where they find the households with low usage pattern. They were ordering refills surreptitiously against those households and this was reported in newspapers. This will just now institutionalize this practice but I digress.

Distributor 2 - Consumer 0

I don't get any receipt obviously because that refill was never ordered by me. Receipts are given by distributors.

Distributor 3 - Consumer 0

And as to that simple thing of making an entry in the passbook where that delivery guy puts an illegible signature every time, I am sure if I go to the distributor with my pass book and show him/her missing entries he/she is going to scoff at me and say it was my mistake that entries were not made. No this is not conspiracy theory, this is how corruption thrives in India.

Distributor 4 - Consumer 0

Where is my redress mechanism in this flaw ridden process? In an online system maybe they could make the end consumer a participant in the supply chain process but most of India is not yet computer literate or has online access.

Ending on the note that I started out on this post, it is sad to see that to justify the triumph of the "free" market we are absolutely fine about letting corruption break the backs of the poor and the underprivileged.