The Hindu Business Line : Fuelling the oil crisis

This refers to the editorial `Late and little' (Business Line, September 7), which talks of the government's lethargy in finding a permanent solution on the country's oil crisis. After much dithering and delaying the government came out with a proposal that neither satisfied the oil companies nor the consumers.

As the oil majors are owned by the government, any losses generated will have to be borne by it. Thanks to the continued rise in international oil prices, domestic price of crude is still on an upward trend and this may tide companies over their accumulated shortfalls, so far. But the future consequences on account of a further hike in oil prices remain a perpetual threat.

It is also interesting to note that the government wisely decided to steer clear of `politically sensitive' items of kerosene and LPG. The talk of a Rs 30-hike in LPG is causing concern for consumers, the majority of whom belong to the middle class fixed-income group. It would have been better if the government assumed the subsidy burden of LPG from the oil companies. As suggested by the Left, the government should consider excise duty cuts and, if need be, supplement these with sale tax cuts by State governments. The chances of long-term solutions should be explored with a view to causing minimum unrest and worry to consumers.

C. P. Velayudhan Nair

Kochi

Letters to the editor and contributions can be sent by e-mail to: bleditor@thehindu.co.in

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