Thousands Arrested in Fuel Price Protests in India

[jk]

NEW DELHI — Protests against a recent increase in fuel prices shut down markets, schools, airports and businesses across India on Monday, and thousands of people were arrested as violence flared in some cities.

[snip]

As it moved to eliminate subsidies on petroleum products, the Congress government said June 25 it would raise the price of gasoline by 3.5 rupees, or 7.5 cents, a liter. Diesel is being raised by 2 rupees a liter, and kerosene, which makes up a large portion of expenses for poor people, by 3 rupees.

India’s state-run fuel companies must sell oil and natural gas at government-set rates and will lose 530 billion rupees this fiscal year, the Ministry of Petroleum and Natural Gas said last month. Finance Minister Pranab Mukherjee said Sunday that the fuel price increases would not be rolled back, regardless of the scope of the protests Monday


etc
http://www.nytimes.com/2010/07/06/bu...l?ref=business

[Mega]

Re: Thousands Arrested in Fuel Price Protests in India

Looks like they had a "taste of honey"..............rather liked it.......& now are rather keen to keep it!

Mike

[don]

Re: Thousands Arrested in Fuel Price Protests in India

Nice to have a Brit in our midst to properly frame the jewel in the crown. Well done, Mike!

[jk]

Re: Thousands Arrested in Fuel Price Protests in India

there were food riots around the world when oil went over $140. turns out oil can stay at $80 or less and we can have riots by removing the subsidies and exposing people to the real market price. the europeans are way ahead of the americans by virtue of having high energy taxes in place, so that market movements don't matter as much in relative terms. we are directly exposed to the market.

ej/fred have described the recent recession as the first peak cheap oil recession, triggered by the price run-up in '07-'08. perhaps in the current deflationary environment, a steady price of $75 or so is sufficient to have the same effect.

[sishya]

Re: Thousands Arrested in Fuel Price Protests in India

Inflation in India is galloping : Food prices is 3 times the price 10 years ago. Of course wage inflation has also gone up the same amount, but now it looks like
food inflation will rise faster than wage, which can cause troubles like this. Poor people have now started to suffer.

[jk]

Re: Thousands Arrested in Fuel Price Protests in India

Inflation in India is galloping : Food prices is 3 times the price 10 years ago. Of course wage inflation has also gone up the same amount, but now it looks like
food inflation will rise faster than wage, which can cause troubles like this. Poor people have now started to suffer.

is the food inflation also by virtue of the removal of subsidies? i don't think global agricultural prices are up that much. just checked rice and wheat: both are up, but less than double their prices of 10 years ago. not 3 times.

[touchring]

Re: Thousands Arrested in Fuel Price Protests in India

is the food inflation also by virtue of the removal of subsidies? i don't think global agricultural prices are up that much. just checked rice and wheat: both are up, but less than double their prices of 10 years ago. not 3 times.

Food prices might have gone up as a result of speculation by wholesalers and retail merchants. As merchants see prices rising, they hoard, causing prices to rise further.

[GRG55]

Re: Thousands Arrested in Fuel Price Protests in India

NEW DELHI — Protests against a recent increase in fuel prices shut down markets, schools, airports and businesses across India on Monday, and thousands of people were arrested as violence flared in some cities.

[snip]


As it moved to eliminate subsidies on petroleum products, the Congress government said June 25 it would raise the price of gasoline by 3.5 rupees, or 7.5 cents, a liter. Diesel is being raised by 2 rupees a liter, and kerosene, which makes up a large portion of expenses for poor people, by 3 rupees.

India’s state-run fuel companies must sell oil and natural gas at government-set rates and will lose 530 billion rupees this fiscal year, the Ministry of Petroleum and Natural Gas said last month. Finance Minister Pranab Mukherjee said Sunday that the fuel price increases would not be rolled back, regardless of the scope of the protests Monday

etc
http://www.nytimes.com/2010/07/06/bu...l?ref=business

It appears to be spreading...

Iran to stop subsidised petrol sales from September

Mon Jul 5, 10:59 am ET


TEHRAN (AFP) – Iran is to halt the sale of subsidised petrol from late September as part of plans to phase out subsidies on energy products, ISNA news agency reported on Monday.

"Based on decisions taken, from the second half of this (Iranian) year (late September), the rationed petrol sales will be stopped," said Mohammad Royanian, head of Iran's fuel transportation organisation, quoted by ISNA.

From September "the rationing of petrol will be scrapped," he added.

He did not say what the new, unsubsidised price of petrol would be.

Iranians are currently allocated 60 litres (13 gallons) of petrol a month at a subsidised rate of 1,000 rials (10 US cents). These sales would be stopped, according to Royanian, who did not reveal the new price.

Any other purchase of petrol over and above the rationed quota is at a price of 4,000 rials (40 US cents).

President Mahmoud Ahmadinejad has proposed to phase out subsidies on energy goods that directly or indirectly cost the government as much as 100 billion dollars a year.

His budget proposals for the current Iranian year to March 2011 is marked by the start of a major plan to scrap costly subsidies on energy goods, but economists have strongly criticised the policy as inflationary.

The removal of subsidies is to be a gradual process due for completion by March 2015, the end of a five-year development plan.

[metalman]

Re: Thousands Arrested in Fuel Price Protests in India

It appears to be spreading...

Iran to stop subsidised petrol sales from September

Mon Jul 5, 10:59 am ET


TEHRAN (AFP) – Iran is to halt the sale of subsidised petrol from late September as part of plans to phase out subsidies on energy products, [COLOR=#366388! important][COLOR=#366388! important]ISNA [COLOR=#366388! important]news [/COLOR][COLOR=#366388! important]agency[/COLOR][/COLOR][/COLOR] reported on Monday.

"Based on decisions taken, from the second half of this (Iranian) year (late September), the rationed petrol sales will be stopped," said Mohammad Royanian, head of Iran's fuel transportation organisation, quoted by [COLOR=#366388! important][COLOR=#366388! important]ISNA[/COLOR][/COLOR].

From September "the rationing of petrol will be scrapped," he added.
He did not say what the new, unsubsidised price of petrol would be.
Iranians are currently allocated 60 litres (13 gallons) of petrol a month at a subsidised rate of 1,000 rials (10 US cents). These sales would be stopped, according to Royanian, who did not reveal the new price.
Any other purchase of petrol over and above the rationed quota is at a price of 4,000 rials (40 US cents).

President Mahmoud Ahmadinejad has proposed to phase out subsidies on energy goods that directly or indirectly cost the government as much as 100 billion dollars a year.

His [COLOR=#366388! important][COLOR=#366388! important]budget [COLOR=#366388! important]proposals[/COLOR][/COLOR][/COLOR] for the current Iranian year to March 2011 is marked by the start of a major plan to scrap costly subsidies on energy goods, but economists have strongly criticised the policy as inflationary.

The removal of subsidies is to be a gradual process due for completion by March 2015, the end of a five-year development plan.

in oil producing countries the pols bribe the prols with oil... in reserve currency producing countries with credit.

[Chris Coles]

Re: Thousands Arrested in Fuel Price Protests in India

Such subsidies are a hiding to nothing and bring all sorts of downside. Must have looked like a good idea when almost no one had any form of oil product powered vehicle, but now they are moving forward, away from developing nation towards a Western style economy with many more owning vehicles, the strain on the internal finances has reached breaking point. And then, the price of oil is bound to once again soar, so better to start to draw down the subsidies now, while the price of oil is relatively cheap.

[ViC78]

Re: Thousands Arrested in Fuel Price Protests in India

This is certainly a scary picture. Here is the distribution of a typical Indian's expense.

426795-126140986525062-Faisal-Humayun.JPG

• In 2008, it was estimated that India loses INR 58,000 crore worth of agricultural food items due to lack of post harvesting infrastructure such as cold chains, transportation, and storage facilities. If the Government ensured proper storage facility, food inventory would have been more then sufficient leading to prices remaining under control. I am not sure if the Government is still doing enough to have proper food storage facilities in the country.

• The Indian farmers are largely dependent on the four-month monsoon season during which 80% of the year's total rainfall takes place. The reason is that 60% of the country's total cropped area is not irrigated. The Government has again been talking about inclusive growth and stress on rural India. These facts don't point to any meaningful efforts to help farmers in a country where over 10,000 farmers have committed suicide over the last decade.

• The per hectare agricultural yield in India is half that of China. This again points of inefficiency and the failure to help the farmers adopt latest technology in order to increase the crop output.

http://seekingalpha.com/article/1791...uses-solutions