Trinamool Congress chief and West Bengal chief minister Mamata Banerjee has issued a fresh threat to the government and said that she will withdraw support if diesel and LPG prices are tinkered with, reports said on Wednesday.
"I am concerned about LPG and diesel, where the government is planning to increase prices. If price rise happens, then we may have to think again," Banerjee was quoted as saying by CNN-IBN.
This was after Prime Minister Manmohan Singh told Trinamool Congress MPs on Tuesday that there will be no rolling back to the pre-liberalisation days, stonewalling their protest against the petrol price hike.
He even refused to promise that diesel and kerosene prices would remain untouched.
Finance minister Pranab Mukherjee, meanwhile, negotiated the Rs 19,000-crore bailout package with Banerjee in Kolkata.
Looking irritated after the meeting, Banerjee somehow saved face with a “further hikes in petro prices will mean we are out” threat.
Mukherjee, on his return from Kolkata, went straight to the PM’s residence to brief him on the Kolkata development.
In Delhi, Singh’s response to a similar threat by TMC leaders: the government had not taken any such decision, yet.
Trinamool chief whip in the Lok Sabha Sudip Bandopadhyay also made an attempt at saving face after meeting Singh, saying, “The PM agreed with our sentiment. He also categorically said there was a lack in coordination which needs to be improved.”
But Singh turned down TMC’s demand for setting up a coordination committee, although poor coordination was one of the issues Banerjee had raised while threatening to pull out from the UPA.
Asking the TMC MPs — with six union ministers among them — to act responsibly, Singh said power meant responsibility. He said a rollback of the petrol price hike was not a feasible option as tax cuts to bring down petrol prices would invariably affect social sector spending.
Singh explained that sustained under-recovery by oil companies would make them bankrupt. He said the government had so far only “tinkered” with the petrol prices as they did not affect the masses.
Singh even gave the example of Greece, where huge subsidies led to the present crisis.
Singh said uncontrolled subsidies would send wrong signals to foreign investors.
Railway minister Dinesh Trivedi was the first to speak from the TMC side, narrating what transpired in the meeting of the empowered group of ministers on oil. The PM snubbed him, saying he could not reveal cabinet secrets.
Minister of state for urban development Saugata Ray said while the government was trying to protect the oil companies, the price hike ultimately hurt the people.
MoS for rural development Shishir Adhikary even spoke about reducing the oil companies’ expenses and bringing their salaries at par with other central government employees.