The government on Thursday hiked the price of diesel by Rs 5 per litre, to be effective from midnight. The Cabinet Committee of Political Affairs (CCPA), however, decided not to hike the price of kerosene.
The CCPA, headed by Prime Minister Manmohan Singh, also ended the subsidy on branded diesel fuel saying it would be sold at market rates.
In another major decision, it was decided that a household would get a maximum of six LPG cylinders at the subsidised price per year.
The government, however, spared an increase in petrol price by cutting excise duty of Rs 5.50 per litre.
Reacting to the decision of the CCPA, the Trinamool Congress, a key UPA ally, said that the effect of the hike in the diesel price would trickle down to essential commodities.
West Bengal Chief Minister Mamata Banerjee said she was shocked with the decision as her party was not consulted on the issue by the government.
“I am really shocked by the decision. The government did not consult us before hiking the price,” said Banerjee.
She also said that the issue was not discussed at the UPA coordination committee even.
She added, “We are part and parcel of the UPA…I want to know why the price was hiked without consultation.”
Speaking exclusively to CNN-IBN, the Trinamool Congress chief expressed her anger saying, “The hike is going to affect the farmers and prices of commodities are going to go up.”
She said that the matter was quite serious and her party would not tolerate things that affect people, adding that the government must withdraw the hike.
The West Bengal Chief Minister said that she would take up the matter in party meeting, but maintained that she would continue to stay with the UPA.
Earlier, speaking to CNN-IBN, Trinamool Congress spokesperson Kakoli Ghosh Dastidar said, “We will discuss the fallout of the hike in party forum.”
The Congress also said that as a party, it was not in favour of the hike. “As a party, we are not in a favour of the hike as it hurts the farmers,” said Congress general secretary Digvijaya Singh.
He, however, added that “there are some unpleasant decisions that have to be taken by the government in power”.
Meanwhile, reacting to the announcement, the Bharatiya Janata Party (BJP) said they protested the hike.
BJP leader Ananth Kumar said, “It will have cascading effect on inflation, it will have direct effect on common man, farmers and labourers.”
“The cap on the LPG cylinders will hurt the poor. This government has brought back control economy of past era,” he added.
Describing the hike in diesel prices as a cruel joke and “mortal blow” on the common man and farmers, the BJP accused the government of conspiring with petrol ‘mafia’ and said it will not allow the hike and take to the streets instead.
“This is a cruel joke on the common man in the country. It has hit farmers hard during the peak paddy sowing season. We will not allow this hike. We will not allow this government to loot the common man like this,” BJP Vice President Mukhtar Abbas Naqvi said.
“The way this government is increasing prices of petrol, diesel and LPG despite a reduction in international crude prices, it is a clear-cut case of a conspiracy with the petroleum mafia,” Naqvi said.
BJP leader Yashwant Sinha said the hike will have a cascading effect on prices and will contribute further to inflation.
“It is a mortal blow of Rs 5 increase in diesel price and will cause hardship. Had it been raised in small amounts it would not have been that objectionable or difficult. Diesel increase will have a cascading effect on the economy as a whole. Prices are already not under control, so this is going to contribute to overall inflation and create mayhem in the economy,” Sinha said.
The Left Front also opposed the move by the government calling it a “highly condemnable action”. CPM leader Brinda Karat said that at a time when food inflation was rising, the diesel price hike would have a cascading effect.
Karat said, “There is no question of waiting. The government has to roll back and reverse it entirely.”
List of diesel price in major cities:
Ahmedabad:The price after the hike would be Rs 51.38 per litre, which is Rs 45.89 per litre at present.
New Delhi: The price of diesel in the national capital would be Rs 46.32 per litre following the hike. Currently, the price is Rs 41.32 per litre.
Mumbai: In Mumbai, where the current price is Rs 46.25 per litre, the price of diesel will be Rs 51.25 per litre after the hike.
Jaipur: Currently, the price in the Rajasthan capital is Rs 43.25 per litre, and would be Rs 48.22 per litre post midnight.
Chandigarh: The price after the hike would be Rs 46.94 per litre, which is Rs 41.25 per litre at present.
Kolkata: In the West Bengal capital, the price at present it Rs 44.76 per litre at present, and would be Rs 49.76 per litre post midnight.
Chennai: Currently, the diesel price in the Tamil Nadu capital is Rs 43.91 per litre, and following the decision, it would be Rs 48.91 per litre.