Although FY 2021-22 is still a month and a half left to commence, there is a high possibility that it will begin on an inflationary note, if the ongoing rise in oil prices continues unchecked. Sunday marked the 6^th day in a row when prices of two essential fuels which keep the nation moving, petrol and diesel rose sending alarms among people. The annual budget carried the assurance that FY 21-22 will herald revival of the economy which has been ravaged by corona pandemic. Inflation will be the most unwanted component in the turnaround process  and unfortunately, thanks to the prevailing ‘highs’, the impact will only be negative. As it always happens, the man on the street will be the first to receive the shock. But this time, in magnitude it will be bigger than most earlier occasions as people’s earnings have dwindled due to the after-effects of the pandemic. A cut in excise duties might have lessened the impact, but such measure, as of now is only a distant possibility.

The past six days have seen daily addition in oil prices and Sunday’s figures show that across all metros new records are being made and the immediate possibility is that it will cross the Rs 100 mark for petrol for sure and for diesel nearly of the same degree if the trend continues for a week or more. Expectedly, the same old tale that ups and downs in oil prices in the country are directly and proportionally linked to international crude oil prices has been repeated. While this is true since India has to import more than 80 % of its oil needs, a little recapitulation will reveal that in March 2020 when there was a record fall in global oil prices due to the pandemic, hardly any benefit was passed over to the citizens. The reverse actually happened and it was since mid-March 2020 till date, after hike in duties by record margins to derive the gains arising out of the international price fall, retail petrol rates have risen by Rs 19.16 per litre and for diesel by about Rs 16.77. For the current rise, the Union Petroleum Ministry has reasoned that it’s because of the ‘artificial price mechanism’ devised by the oil producing nations. Even if it’s true, the question why there is no shock absorbing mechanism till date to counter the overseas impact that would shield the common people still arises. The existing situation in particular when the urgency to return back to economic normalcy is high deserved a shield of this kind.

For an already fragile economy, inflationary pressure, as an immediate fallout of the unabated oil price hike will only delay the revival dream. 

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Kenter Joya Riba

(Managing Editor)
      She is a graduate in Science with post graduation in Sociology from University of Pune. She has been in the media industry for nearly a decade. Before turning to print business, she has been associated with radio and television.
Email: kenterjoyaz@easternsentinel.in / editoreasternsentinel@gmail.com
Phone: 0360-2212313

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