Fuel prices have touched record highs and no one knows where the end point is. Fuzzy answers from economists and experts alike are creating more confusion rather than imparting clarity. One clear statistic is that India imports 70 per cent or more of its fuel and as oil prices keep climbing in dollar terms and the rupee keeps depreciating this equation will keep getting worse.
One could always argue that India should have hedged most of its requirements when oil prices had hit the bottom of the barrel literally. And a lot of theories are being expounded on how to manage this situation at present. But given the current reality the one aspect that needs to be focussed upon is how to manage our fuel consumption amidst ever increasing cars at one end and bad roads plus traffic, which also ensure guzzling and wastage of fuel, at the other end.
Let us first look at what Boris Johnson did as the Mayor of London. He introduced a congestion charge for vehicles coming into high traffic areas during weekdays. Mayors in India’s metros and urban clusters should consider introducing the same ASAP. It may help to keep cars away on weekdays and reduce traffic, thereby increasing fuel efficiency. More important, it adds an additional revenue stream for the administration. An alternative to simply increasing fuel prices to manage our import bill.
Consider also what Singapore has done. Singapore introduced special licence plates for vehicles that are allowed to drive only after peak hours on weekdays and on weekends. And it is time to bring this concept to urban clusters of India where there are families with multiple cars. And, of course, taxes on cars with normal number plates can be increased in parallel, thereby keeping more cars off the road.
Of course with our Indian smarts we can take things a bit further. Besides the rising fuel bill we are also plagued with an obesity crisis. Think about a ‘Walk to Work’ Day on one day of the week when everyone walks to their workplace and does not use cars. One such day a week is 52 days of low petrol and diesel consumption in all of India’s urban clusters in a year. Imagine the fuel and linked import bill savings.
We are living in an interconnected world where physical presence is only required for some key jobs. How about a ‘Work from Home’ day one day in a week or once a month where employees in applicable job categories can simply work from home. No car, no commute and no linked fuel burnt.
Cycle to work
Although India may not have much fuel it is one of the largest producers of bicycles in the world. And special bike roads can be created within all urban areas in a few months. Then people can safely cycle to work and bicycles can be made tax free to allow more and more people to purchase these. In the process, India can also emerge as the largest producer of bikes in the world not just one of the largest. And India can become a global showcase on non polluting and non fuel based commuting which is also good for the health of the population.
We cannot control oil prices but we can make fundamental shifts that alter our petrol and diesel consumption dramatically. The time to act is now.
The writer is a financial services professional.