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Centre weighs fuel price hikes, WFH mandates
The measures could range from raising pump prices of petrol and diesel to reduce their consumption to work-from-home
The petroleum ministry on Monday said it is working on austerity measures to conserve energy, which experts said could be an indication to increase retail prices of petrol and diesel if the war in West Asia prolongs.
The ministry’s joint secretary Sujata Sharma, who mentioned about austerity measures under consideration, did not give specific details during the inter-ministerial briefing on the fallout of the crisis in West Asia.
Sharma’s comment is especially significant because it comes a day after Prime Minister Narendra Modi urged people to conserve energy and also foreign exchange.
People familiar with the matter said on condition of anonymity that the measures could range from raising pump prices of petrol and diesel to reduce their consumption to work-from-home for up to 50% of an organisation’s employees. State-run retailers are selling petrol and diesel at ₹94.77 per liter and ₹87.67 a litre respectively in Delhi for last two year. They are currently losing ₹24 and ₹30 on each litre, respectively.
Although global energy supply chains have been disrupted due to the closure of the Strait of Hormuz, India has been able to manage the situation so far since the war broke out in West Asia on February 28—but some voluntary and some compulsory energy conservation measures are required for a country that imports over 88% crude oil it processes, the people mentioned above said.
Similar short-term measures were taken by the erstwhile UPA regime in 2013 when global oil prices spiked, they said. Then oil minister Veerappa Moily launched voluntary fuel conservation campaign that included use of metro and bus by government and public sectors officials and staggered office timings.
Sharma on Monday said that indiscriminate consumption of imported energy would hurt both the state-run oil marketing companies (OMCs) and the economy. She said the government has ensured supply of petrol, diesel and domestic liquefied petroleum gas (LPG) to people without interruptions through OMCs.“But it is also true that our companies purchase costly crude oil from the [international] market and selling [refined petroleum products] cheaper in the domestic market. Because of that their finances are under pressure,” she added.
She said that Prime Minister’s advice to people to conserve energy should be “seen it in this context”. The three OMCs are losing monthly revenue of about ₹30,000 crore on sale of petrol, diesel and cooking gas, while the government has forgone revenue of ₹14,000 crore per month from March 27 when it reduced excise duty on petrol and diesel by ₹10 each.
Replying to questions pertaining to the austerity measures proposed by PM on Sunday such as work-from-home, using public transport, car-pooling and use of electric vehicles to conserve petrol and diesel, Sharma said: “On this matter, I would only say that the ministry will work on it and we will come back to you in due course.”
