Basically the Finance Ministry has reacted too slowly and irresponsibly.
All along it was clear that duties being advalorem the Government was making more money on imports.
Import or crude attracts 5% duty.
When the price was US $ 35 per barrel the amount of customs duty the Government earned was Rs. 70 per barrel. ( US $ 35 @ Rs. 40 = Rs. 1400 X 5% = Rs. 70 per barrel ).
Now the price is US$ 130 which is Rs. 5400 assuming same exchange rate of Rs. 40 ( actually it is now Rs.43 hence Government earns more, 15% more to be precise ). On Rs. 5400 a 5% duty means Rs. 270 per barrel. Which means customs duty earnings has gone up by 285% !!!! All this increased revenue has been reflected in loss for the oil marketing companies. Hence it is a misnomer. The reality is Government could have actually controlled the price line by eiminating customs duty.
Besides there are other measures that could have been adopted. AT LEAST THEY CAN BE ADOPTED NOW. - Elimination of sales tax at retail point. - Increased use of ethanol in fuel mix. - Increased spending in development of solar products. - Increased R&D in development of cars with battery power. This should be capable of more HP and speed.
Of course, as somebody has pointed out in this forum, we all have consciously reduce fuel usage.
RE:Finance Ministry should have acted earlier
by rajesh vora on May 27, 2008 04:41 PM Permalink
excellent observation. i have been thinking on similar lines.. i dont understand why doesnt the mainstream media (read TV & newspapers) dont mobilise opinion on these lines so that the government esp. our FM is pressurized into acting on such lines. excellent analysis. congrats.
RE:Finance Ministry should have acted earlier
by Rishi Neema on May 30, 2008 11:50 AM Permalink
Dear All,
Everyone of you has given some interesting suggestions which can be implemented , but practically implication of this suggestions would be like discrimination of richer and poorer . Where as our country being only one nation in entire globe who talks about equal right.
Hence I dont think we should go with this kind of suggestion.
Rather Rationing of Oil can be done same like Kerosine.
Depending on the family size quantity of petrol should be decided. Same like distribution of kerosine in India through Rationing shops.
At the same time any family requiring extra petrol can get the same on premiums.
i.e. If petrol is available for say 55 Rs. / Ltr. and the quantity for a family of four people is say 20 Ltrs. / Month If the family requires say 25 Ltrs. / month which means 5 ltrs. extra then the balance 5 would be available on premiums may be @100 rs./ltr.
This way country would save ample of foreign money , $ reserves would increase and would generate good amount of revenue for the nation.
Pl. comment on same if u do not agree with the same.
Thanks and Regards Rishi Kant Neema 09755097229 (M)
RE:Finance Ministry should have acted earlier
by ASHOK on May 28, 2008 04:48 PM Permalink
I support and appreciate your inputs. But right now FM has committed huge amount as FARM LOAN WAIVER. Govt can not mop this huge amount if it lowers tax on crude oil.
RE:Finance Ministry should have acted earlier
by Thiyagrajaan on May 27, 2008 04:14 PM Permalink
Barani pls. try to understand that Politicians and IAS officers are people who can't think andhence they can't understand issues. They are good subordinates and it is unfortunate that there is no one to guide them.
Why is everyone creating such a big hue and cry over oil prices? After all, it is a precious commodity, with finite supply (as determined by known oil reserves) and steadily rising demand. So rise in prices is inevitable. If you look at inflation-adjuested price of oil vis-a-vis other precious commodities like gold, you will realise that crude prices still have some way to go!! It is better if government raises petrol prices to market-determines rates...maybe that might be one way to cut down on wasteful demand and maybe people will start using more public transport and less gas-guzzlers like SUVs and luxury sedans.
Why cant the government reduce the taxes and duties put on oil by the central and state governments. Near by countries such as pakistan oil sells at much lower rates than us.
the control on oil prices is also with few oil rich countries who are manipulating the prices for their profit.
Oil rpices would continue to shoot up till Jan 2009 after which hopefully the new democrats govt in U.S comes in. It should order immediate pullout from Iraq and make peace with Iran. This would help cool the sentiments of the oil producing countries. OPEC needs to play a larger role in liasoning with oil producing nations. At the same time global level "herculean" initiatives need to be taken to make people aware of saving fuel.
RE:New Democrats Govt in US is the answer
by Rishi Neema on May 30, 2008 11:51 AM Permalink
Dear All,
Everyone of you has given some interesting suggestions which can be implemented , but practically implication of this suggestions would be like discrimination of richer and poorer . Where as our country being only one nation in entire globe who talks about equal right.
Hence I dont think we should go with this kind of suggestion.
Rather Rationing of Oil can be done same like Kerosine.
Depending on the family size quantity of petrol should be decided. Same like distribution of kerosine in India through Rationing shops.
At the same time any family requiring extra petrol can get the same on premiums.
i.e. If petrol is available for say 55 Rs. / Ltr. and the quantity for a family of four people is say 20 Ltrs. / Month If the family requires say 25 Ltrs. / month which means 5 ltrs. extra then the balance 5 would be available on premiums may be @100 rs./ltr.
This way country would save ample of foreign money , $ reserves would increase and would generate good amount of revenue for the nation.
Pl. comment on same if u do not agree with the same.
Thanks and Regards Rishi Kant Neema 09755097229 (M)
A Crude Game: Paying For Our Own Destruction by John Hoefle
The use of petroleum as a weapon by the British Empire has been a key feature of the oil business since its beginning. The original oil fields, in Pennsylvania and Texas in the United States, and in Russia, were taken over by British-allied interests, whose initial interest in oil was as fuel for a new and more powerful navy, in preparation for World War I. As the world industrialized, oil became even more important, and the control of oil assumed even greater importance for the British.
The history of oil is one of deception and manipulation, of the creation of giant cartels and front groups to hide imperial machinations. From the beginning, the vast wealth of the oligarchy, channeled through the City of London, was used to buy up the oil fields and suppress competition. Royal Dutch Shell took control of the Russian oil fields; the Anglo-Persian oil company, today known as BP, took control of fields in the Middle East; and John D. Rockefeller's Standard Oil dominated the oil business in the United States. These companies, or their descendants, still control the world's oil markets. There is no such thing as a "free market" in oil, and there never has been.
There are, today, three layers of control over oil. The first is OPEC, the organization of major oil-producing countries, which was a creation by the British, the purpose of which is both to set a floor under the price, and to provide a convenient scapegoat. Th
India and the world needs to develop alternative sources of energy fast, in fact very fast, to escape the oil crisis. It was, in part, the fillip given to development of alternative sources of energy by the Jimmy Carter led US administration in the late 70's that did much to put a pin into the inflated egos of the oil lobby, and led to the cheap oil (internationally) of the 80's. India is well placed to develop wind, solar, and tidal energy, and if the government gives an incentive for the development and sale of electric cars, along with tax breaks for owning them, it would go a long way to prevent our not so high forex reserves from being wasted so extravagantly on oil. With the cheap oil of the 80's, the Reagan and subsequent US administrations scrapped the alternative energy measures initiated by Carter, and consequently the US has to face the spectre of high oil prices today. With the US Congress lashing out at the oil companies in the US, they have now started circulating the idea of 'Brakken oil' through the back door, suggesting that the price of oil can then be brought down to $16 a barrel. This is just another attempt by oil majors around the world to delay the introduction of alternative technologies for use by the masses, so that they can profit from huge oil prices. It is significant to note that many enlightened quarters believe that part of the petro dollars we pay get funnelled into financing terrorism against us. What can we hope for unless we stop financing
Everyone of you has given some interesting suggestions which can be implemented , but practically implication of this suggestions would be like discrimination of richer and poorer . Where as our country being only one nation in entire globe who talks about equal right.
Hence I dont think we should go with this kind of suggestion.
Rather Rationing of Oil can be done same like Kerosine.
Depending on the family size quantity of petrol should be decided. Same like distribution of kerosine in India through Rationing shops.
At the same time any family requiring extra petrol can get the same on premiums.
i.e. If petrol is available for say 55 Rs. / Ltr. and the quantity for a family of four people is say 20 Ltrs. / Month If the family requires say 25 Ltrs. / month which means 5 ltrs. extra then the balance 5 would be available on premiums may be @100 rs./ltr.
This way country would save ample of foreign money , $ reserves would increase and would generate good amount of revenue for the nation.
Pl. comment on same if u do not agree with the same.
Thanks and Regards Rishi Kant Neema 09755097229 (M)
RE:Oil in the world
by Fried Yakov on May 27, 2008 12:49 AM Permalink
(continued from above) terror (indirectly) against ourselves. Electric and hybrid cars are an option. Ofcourse we need to develop renewable sources for electricity too. The Swiss are working on a solar powered aeroplane capable of carrying 300 passengers, while Ireland has built the world's largest tidal turbine.
Islamists/Arab's want many issues to be resolved. (palestine, kashmir etc.,)That's why sheiks's started to target western world and south asia especially india (economic growth, more consumption) by increasing oil prices. They will aim to make it 100Rs per litre. India has to prepare for the worst scenarios and start in war footing for alternative fuel/technology. Drastic steps neede
RE:RE:Higher price is good
by vinod kumar on May 26, 2008 10:35 PM Permalink
Agreed. Cars were sold in 1913 first as non-polluting technology because horses were 'polluting' when they poop on the road. After 100 years of 'clean oil' what do we have?? Global warming, plastics, pesticides (by-products), Oil Wars, Saudi funded Islamic extremism and arms deals. I pray that oil run out soon and humanity return to sanity and live in closer communities instead of destroying the land.
