Since 2 months, there has been a sudden increase in the prices of petrol and diesel which is pinching the common man big time. The price of petrol has reached Rs 80 while the diesel has reached to Rs 75 which is definitely not a joke. The common people are wondering what exactly is happening with the government and why isn’t PM Modi taking any action.
The opposition, on the other hand, has got an ammunition to attack the government and questioning on PM Modi’s Achhe Din slogan. Of course, anyone would feel the pinch and people have the right to know why has the petrol prices escalated to an unimaginable extent. But it is important to tell people the truth behind the rise in petrol and diesel prices.
If we remember just few days after PM Modi took oath as Prime Minister of India, he had made a statement that the economy was in ICU and we need to take bitter medicine to cure the economy. However, PM Modi did not reveal much about the massive NPA scams and the huge loans given to big industrialists and businessman by the UPA government which had literally sunk the economy and red flagged all the foreign investment. Though many economists suggested PM Modi to reveal the real scenario and release white paper, Modi refused to do so fearing a backlash of foreign investments. It was only after 4 years, once the economy was back on track, did PM Modi reveal that the huge scams of Congress government was neither Coal scams or 2G or CWG, but it was NPA.
Now, the same scenario has been unearthed in Oil prices as well. All that we see is petrol prices increasing on a daily basis, but the real reason for this situation is because the government is clearing the massive oil debt of Rs 1.44 Lakh crore and an interest rate of Rs 70,000 crore which was left unpaid during Congress rule.
Yes, during 2012-2014, the international oil prices soared suddenly, however the then government did not increase the petrol/diesel prices. The main reason was because the Congress which was already in severe reputational crisis with massive corruption, loot and destruction of the economy did not wanted to enrage people. So, any further increase in petrol/diesel prices by Congress would have resulted in people literally smacking them with sticks. So, what Congress did was, instead of paying cash to oil manufacturing companies, they started paying in Oil bonds. Oil Bonds are just like a credit value given to someone with an assurance of repaying it in the future.
So, the Congress bought oil providing post dated bonds which have now become a massive bane on the present government. A total of Rs 1.44 Lakh crore worth bonds which had piled an interest rate of 70,000 crore was in debt.
So, this amount is being paid by PM Modi now. Just 2 months back, the Union Petroleum and Natural Gas Minister Dharmendra Pradhan had clarified that the government till now had paid 1.44 lakh crore + 70,000 crore interest to the oil companies which were due since 2012.
Mr Pradhan had said, “They (Congress govt) took loans through oil bonds as they knew that they would not return to power due to the kind of loot (scams) the government was involved in,” “A father who leaves behind property for his next generations is seen with respect in the society but what one would say about the father who takes loans and turns bankrupt and leaves baggage for his generations to come.”
So, how do we expect the petrol and diesel prices to go down with such a huge credit balance?! The economy was in a mess, it took almost 4 years to put it back on track and get the loan defaulters to repay the bank. Now, we have oil bonds which were supposed to be repaid back. It is not that the government cannot reduce oil prices forcefully, of course they can, but it may lead to the rise in the price of other commodities.
This is why the government is rectifying things in a systematic way which is taking long time. But surely the prices will be tapered down in a correct means and most probably brought under GST which will regularize the oil market. This is the bitter pills our country is taking for the mess created by the Congress.
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