Price hike: Cong asks oil cos to explain rationale

Congress was on the backfoot over price hike asking oil companies to put out the rationale behind the increase in public space.

Updated: Jan 17, 2011, 22:14 PM IST

New Delhi: With its ally Trinamool Congress protesting petrol price hike, Congress was on Monday on the backfoot over the issue asking oil companies to put out the rationale behind the increase in public space as it had agitated people.

Though speaking disapprovingly of the increase in petrol prices by Rs 5 in a month, the party remained non-committal on whether the policy of administered price mechanism needs a re-look.

While party leaders speaking on the condition of anonymity said that hike in petrol prices is bound to happen corresponding to the rise in iternal pricing of petroleum products, party Spokesperson Manish Tewari told reporters, "but a Rs 5 hike in one month does seem a tad unfair".

Tewari said, "It is incumbent upon companies to put the justification in public space. What is the rationale of that increase must be told to the public... It does rightly so agitate the mind."
The Congress spokesperson, however, refused to give direct answers to questions on whether the party now viewed that the issue of decontrol of petrol of prices need to be revisited saying "it`s a policy matter. I cannot answer".

"I don`t think any government or any company would like to unnecessarily burden common people. But the reasons for this increase must be properly put in public space and I am sure if the reasons are not proper, the government will democracy it is incumbent upon government and public sector companies to explain the rationale of any such decision," Tewari added.

He was replying to questions on why the party was not giving a clear view on the issue of price mechanism for petroleum products.

"It will be a case of putting the cart before the horse," he said when asked whether the party would ask the government to reconsider the issue of administered price mechanism in the wake of hikes in petrol prices in the last few months.
On Mamata Banerjee`s strong reaction to the hike, Tewari said Banerjee or any other ally is expressing the sensitiveness towards common men and recalled that Congress President Sonia Gandhi had also flagged the issue of inflation during the party`s plenary and expressed her concern.

Maintaining that "inflation was an issue of concern", Tewari said that Gandhi had "specifically said that the government needed to work on it".

A party leader speaking on the condition of anonymity said that one could not run away from the reality.

"If prices of oil increase in international market and oil companies here do not hike the rates, the government will have to give subsidies, which will increase deficit and result in hike in prices of commodities. If petrol prices are increased, it is the real consumers who are directly paying for their use."