DC debate: Should people give up LPG subsidy?

Cut taxes, not LPG subsidy

The appeal made by Prime Minister Narendra Modi — for people to give up LPG subsidy voluntarily, if they can afford to buy cylinders at the market price — is nothing but a publicity stunt. His appeal once again proves that there is no change in the basic functioning of the National Democratic Alliance government, right from Atal Behari Vajpayee’s time in the late 1990s to 2004, and now under Narendra Modi.

Mr Modi’s appeal tries to give an impression that people are at fault by claiming subsidy, while the government is generous in extending subsidy to all (even to people who are not eligible and can afford to buy at the market rate).

Mr Modi is conveniently forgetting that the prices of petrol, diesel and LPG should be fixed in accordance with the international crude oil prices and this policy decision was taken by none other than Mr Vajpayee. The same policy was followed by the United Progressive Alliance government.

Mr Modi should realise that international crude oil prices peaked during the UPA regime and crossed the $115 per barrel-mark. The crude prices have today come down to just about $50. However, petrol and diesel are still sold for nearly Rs 70 and Rs 60 per litre respectively and subsidised LPG cylinder for Rs 450. The rates are almost the same as during the UPA regime, when crude prices were much higher. Mr Modi should know that the amount he is losing on account of LPG subsidy is small when compared to what he is minting from the public by deliberately keeping the LPG and fuel prices on the higher side despite steep decrease in crude prices.

As per the open market policy being adopted by the Union governments since Mr Vajpayee’s tenure, the current price of petrol should be Rs 30 per litre, diesel should be Rs 21 per litre and LPG cylinder for Rs 250.

But the NDA government has been openly looting the public by imposing various taxes and deliberately keeping the prices higher.

Under these circumstances, what right does Mr Modi have to ask people to give up subsidies voluntarily? 

If he is really sincere and committed towards saving public money, he should allow the prices of LPG and fuel to be in accordance with the present crude prices.

Moreover, Mr Modi should also realise that people are already over-burdened with various taxes imposed by the Centre and they have every right to seek LPG subsidy from the Centre. Service tax was hiked indiscriminately recently and there is a proposal to impose another cess for Swachh Bharat.

It is meaningless to put the blame on people for subsidy burden while the reality is that Mr Modi alone is imposing heavy burden on people by deliberately keeping prices of LPG and fuel high.

Way to help in nation-building

Prime Minister Narendra Modi’s appeal to the rich to give up LPG subsidy is a welcome gesture. The country has spent thousands of crores on subsidy over many decades. Many subsidy schemes were introduced just for the sake of “vote-bank” politics. Nowhere in the world does any country provide as many subsidies as India.

While I am not against providing subsidies, they should serve as a tool to uplift the needy. The affluent and upper middle-class of the society, who can afford to buy a LPG cylinder at the market price, should take this as an invitation to be a part of nation-building.

India is striving to become an economic powerhouse. But it will not succeed if it continues to bleed a lot of money in the way of subsidies for those who can afford LPG at market price. People from the rich and upper middle-class sections of the society talk of India’s development and how things should change.

This is a chance for them to contribute towards the change they desire and deserve.

A large section of the population in the country today enjoys a good standard of living and earns a decent income. If all such people decide to sacrifice their LPG subsidy, the amount accumulated through such sacrificed subsidies will be substantial. This money can in turn be utilised for some nation-building activity and to provide better services to the country’s citizens.

I believe subsidies should be for the needy, like the Below Poverty Line and lower middle-class families, as they require subsidy to uplift themselves. But those who can afford it, must ponder over this suggestion by the Prime Minister.

The Prime Minister has not made it mandatory for the affluent and upper middle-class people to sacrifice their LPG subsidy. This is to ensure that no one feels that they are being discriminated against on the basis of income. Instead, the PM has given a choice to the people, leaving it completely to their conscience.

This gives an opportunity to many people to develop a mindset of sacrificing monetary benefit for the betterment of society at large.

For many, it may seem that it will not matter much if they sacrifice their subsidy, but as they say, little drops of water make a mighty ocean.