The bonanza of a cut of Rs. 5 and Rs.10 on the price of petrol and diesel per litre given by the Central Government by reducing the excise duty by as much has been reciprocated by the UT Administration by a further reduction of Rs. 7 a litre . That in other words means that both the items would now be cheaper by Rs.12 and Rs.17 in respect of petrol and diesel in Jammu and Kashmir. Needless to add, after the unilateral cut of huge excise duty by the Centre, the State and UT Governments too are enjoined upon to reduce their value added tax accordingly on these prices . Only a few states have followed suit while many have yet to do so.
Since up to 80 percent of our fuel requirements are met by costly imports and while the indigenous demand keeps on increasing day by day, unless serious steps were taken to increase indigenous production by finding new sources and curbing the demand factor by introducing various measures, artificially reducing the prices by vastly affecting the Government revenues would have a telling effect on our developmental projects and priorities – that being the other face of the coin. Politics on simple price mechanism – that too on fuel prices , is unfortunate and is tantamount to ignoring simple economics about the issue.
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