Democracy of shortages..

The current govts policy of tax and spend has meant inflation. Secondly as world oil , gas and commodity prices are going up and causing inflation, the Us dollar is crashing, and gold is up at record levels. This has resulted in a skewed policy by the RBI to try and attempt hold the Rupee against the dollar at close to a Rs 39 peg, so as to protect exports, only increasing the import bill for Oil which is now ruling above 100$ a barrel.

Commodities like wheat, pulses, vegetables and basic amenities that directly affect the end consumers are getting expensive not just in India but internationally and india is an importing country. This will directly hit the aam admi, and the tax adjustment will be negated by the increased inflation.

The Spend aspect of the government, with its supporters in the Communists and the Politicians from the south and Congress, meaning more indirect taxes like vat and service taxes, has not really worked on the ground, because of the pilferage and the corruption. The govt has no inbuilt transparency and still opposes the cleaning up by necessitating permission to prosecute corrupt bureaucrats. Hushing up of the Hasan Ali case doesn’t install much confidence either, when govt expects the aam admi to submit a whole lot of documents while opening something as mundane as a fixed deposit or demat a/c as an anti money laundering necessity, while big guns invest tax free through the Mauritius route or PN route .

Rajivs statement still holds true, as admitted by Rahul baba.

Pakistan is discontent with their fav dictator and his favorite jihadis’ alliance, not as much because of his autocratic behaviour, but mainly because of the lack of job opportunities and rising prices of wheat, fuel and cooking gas, as shown by the recent elections – something that India has been attempting to shield its consumers from , by making oil cos subsidise the oil and cooking gas and pushing the woes and the added deficit off the books to our future generations through oil bonds.

Things can get worse, as the US fed will choose cutting rates stroking the flames of inflation, in the near future, and it will be interesting to see how RBI reacts. The markets are going down and the Pay commission is coming too and the pay hike isnt provided for in the budget figures as the FM says Trust me.

Net result, things are now coming out in the open, the oil companies are slowly tightening the supply as the difference between administered prices and market prices is getting abnormally stretched, making the oil companies bleed red in their balance sheets and have working capital problems, and making it difficult for the staff to remain honest as the incentive to black is far too lucritive.

Now we have Petrol and Diesel being taxed heavily by the central govt, and the same passed on to poor oil marketing company shareholders as subsidy burden, some of which is adjusted against oil bonds burdening future generations and taxpayers.

We have PDS sugar and rice which is never in stock or mostly milavati( low grade due to mixing) as most of it is diverted to the black markets…

Subsidised Grains and Fertiliser share a similar history

Pds keosene available at unbelievably low rs 9.something, a record lowest among world economies while the cost in open mkt is at least 3 to 4 times subsidized price – which is also hardly available thanks to diversion to black markets as the price difference is unreasonable.

Worse there is a real shortage of LPG and cooking gas at subsidized rate has meant wait time for consumers ranging from a week to 15 days, also meaning going back to the 80s and black marketing.

Sarthak Behuria, the chairman of Indian Oil Corporation (IOC), the country’s largest marketer of petroleum products, said a couple of weeks ago that the LPG shortfall would be met in a week, but people are still queuing up at the black marketers’ shops.
Another IOC official said there is no shortage of LPG in the country, but a thriving black market is creating a shortage for genuine consumers.
The illegal sellers of LPG said it is very easy for them to procure the cylinders from the godowns of the oil marketing companies.
“Out of every 50 cylinders that come from the main Delhi godown to the local godowns, almost 40 come to us. We only have to contact the manager of the local godown,” Singh said, adding that he pays Rs 2,500 every month to the policemen in the area.

read the whole article here.

Finally, fancy growth rate numbers adverts in the BBC and Favored news media don’t mean a thing to the aam admi, who will take voting decisions based on the money in his wallet at the end of the day, not on the fancy declarations and Marxist policies.

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3 thoughts on “Democracy of shortages..

  1. since ur post, the dollar has risen to 40.5 INR

    yes i agree that dual pricing which GoI thinks is great is a disaster and only brings in inefficiencies and highlights the difference between teh haves and have nots

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