New Delhi: Terming the government`s justification for the recent hike in petrol price a "gigantic fraud", the CPI(M) on Thursday warned that UPA-II could meet the fate of several European ruling parties which recently suffered electoral defeat as they were pursuing `neo-liberal` economic policies.
"This UPA-II government and Prime Minister Manmohan Singh may well meet a similar fate (like in Europe) unless they reverse the current trajectory of economic policies," senior party leader Sitaram Yechury said while referring to the defeat of nine ruling parties in Europe so far.
"The last in this line was France`s Nicholas Sarkozy. Germany`s Angela Merkel may well be the next," he said in an editorial in the forthcoming issue of CPI(M) organ `People`s Democracy`.
Observing that the government has "turned a deaf ear" to the nationwide protests by Left and other Opposition parties, he said it "continued to justify" the hike on grounds of meeting the "so-called massive losses" of oil companies and to improve the fiscal condition of the economy.
Noting that `under-recoveries` were actually the difference between retail price of petroleum products and its import price, he said it was "notional" in nature as import prices included duties, insurance, freight and other levies which "are not paid by the Indian companies".
Indian oil firms did not pay these levies because "what we import is crude oil that is processed in India to produce petrol, diesel and kerosene," Yechury said, adding "further, the under-recovery figures that the oil companies cry hoarse about are not audited by statutory auditors."
Instead of linking the price of petro products to the cost of imported crude plus domestic refining cost, international price is taken as a benchmark and that "produces these exaggerated notional losses. This is the gigantic fraud", he said.