By Sidharthan

New Delhi: The Modi government is blessed with brainpower to counter any spiky attack from anywhere. On Thursday in the Lok Sabha Finance Minister Arun Jaitley made a brilliant speech on price rise.  A luminous lawyer Jaitley is, and he defended the Modi Government with facts and figures and some forceful arguments. Presenting statistics and accusing the polices of the previous  Manmohan Singh government he tried to establish that the present escalation of prices has nothing to do with his government, rather  the present plight (price rise) is the “gift” of the earlier Congress-led UPA rule at the Centre. But, even ardent admirers of the Modi government wonder, “Has the Finance Minister suggested anything to cool down the price, at least that of the food consumables? Was he not justifying the escalation of prices of essential commodities?”

The Finance Minister had presented the house a well prepared defense for the escalating price. On the question of abnormal price hike in edible items like pulse, he said “high prices of dal are a concern for the entire nation.  The production of pulses within the country is just around 17 million tones and consumption is over 23 million tones. The government has taken steps to address this mismatch in production and demand by importing from abroad.”

The finance has also another solution to confront the price rise. “I am hopeful the production of pulses would raise to 20 million tones this fiscal.  For the past couple of years there was a deficit of rain fall during the monsoon and the production of pulses was badly affected. This year we believe the rain gods will bless the country.”

To this Prof. Saugata Roy had sarcastically commented whether the country needs to depend on Rain Gods, not the Government of the day, to calm down the prices!

However, a BJP member was smart enough to lauding the Modi government saying, “The escalation of prices of essential commodities has helped the farmers to improve their economy. They are now getting high prices for their produces and their standard of living has scaled up.”

To this a member from the opposition was heard asking “then how and why the farmers are committing suicide?”

Rebutting this BJP claim a Congress member said, “There has been a 250 per cent increase in the prices of onion, tomatoes and potatoes.  But the farmers were getting pittance as prices of their produce. Middlemen and hoarders were making huge money. Tackle hoarding to control prices in the short run. I hope the government will take action against hoarders,”

Questioning the claims of the ruling party that the price rise of agriculture produces has benefitted the farmers Congress vice-president Rahul Gandhi said “the government had failed to respond to a critical question on the discrepancy in the MSP and the market price. The farmer toils endlessly and gets a minimum support price of Rs 50. Then he goes to the market and buys his own dal for Rs 200 per kg,”

Outside the House, attacking the Modi government on price rise Rahul Gandhi said “My question is that if you (the government) want to rectify this, you can do it easily. You increase the supply and the price goes down. You are not doing this to help a select few. But finance minister Arun Jaitley did not reply to this question in his half-an-hour reply.”

According to a study in the past five years prices of condiments & spices, eggs, fish and meat, milk, pulses shot up beyond imagination- ranging between 158.07 percent, 78.88 percent, 74.12 percent and 73.69 percent respectively. Many essentials like coffee, tea, wheat, fruits and vegetables scaled up in the range of 70.75 percent, 66.89 percent, 63.25 percent and 59.31 percent respectively during the corresponding period.

In fact, the periodic hike in fuel prices contributes much to the inflation and spurt in commodity prices. However, the Finance Minister justified the periodic fuel price hike even when the crude oil price was dropping in the international market. According to Jaitley the revenue generated (over Rs 2.5 lakh crore) in the past two years, thanks to the slump in crude oil prices in the international market, has been utilized for the benefit of the public.  He said the revenue thus generated has been passed on the public by way of construction of roads and other infrastructure. But hardly anyone is willing to buy this claim.

It is a fact “the international crude oil prices are at a historic low. The Indian crude baskets are down 50% since Shri Modi’s government took over on May 16, 2014, but prices have come down by just 10%. The total tax on Petrol is now higher than the gate price changed by the Oil companies.”

The gate price of petrol (refinery price) is presently Rs 31.82 per liter but by the time it comes to the retail outlets it becomes Rs 63.47 per litre in Delhi and in Mumbai, this is Rs 69.51. Thanks to state and central levies.

Prime Minister Narendra Modi had tried to take credit for the historically low international crude oil prices but we all know that the benefits of the oil crash are not being passed on to the people of the country. The current crude oil price is just below $45/ barrel compared to $109 in early 2014.  But the benefit of this low price is not being passed on to the people.

Interestingly the BJP, then as opposition party had called for an all India Bandh during the UPA regime in 2013 when petrol prices were raised following a spike in international price. But now as the same BJP as ruling party tries to defend the periodic fuel price rise.

The present Modi Government has doubled the central fuel levies in the past two years.  The central excise duty has been hiked from 9.48 per liter of fuel to a massive Rs 17.46 per liter. The Modi government has raised a total of Rs 75,441 crore in fuel tax in 2014-15, about Rs 25,000 crore higher than the previous year. As international crude oil prices continue to slide the tax collections are going to rise even higher in the current financial year.

The common man will continue totter under spiraling commodity prices. The hoarders will continue making fortune. Political parties will continue whipping up passion against opponents. The “achche din” (good days), promised by Prime Minister Narendra Modi, will remain just a mirage.