The Hindu : Karnataka / Bangalore News : LPG, diesel rate hike draws flak

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Sunday, Jun 26, 2011
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Karnataka

Karnataka - Bangalore

LPG, diesel rate hike draws flak

Staff Reporter

BANGALORE: The upward revision in diesel, LPG and kerosene rates the has been condemned as “very steep” which would push up inflation, which is already high.

While the diesel rate is up by Rs. 3.72 a litre in Bangalore, the LPG price revision saw the steepest hike in recent years with the increase at Rs. 50.55 per cylinder. Kerosene became dearer by Rs. 2.10.

According to an official of the Indian Oil Corporation (IOC), kerosene prices had been revised for the first time in two years, while LPG had been revised almost annually. Diesel prices had been revised marginally in October last and this February as well. He also said that the previous revision in LPG rate was around Rs. 40.

Meanwhile, the industry bodies here have been quick to react to the hike, most of whom feared a spike in inflation rates.

‘Cut tax'

The Federation of Karnataka Chambers of Commerce and Industry (FKCC) on Saturday urged the State Government to reduce VAT and entry tax on diesel to provide some relief to the people who have been burdened by the hike in prices of LPG, diesel and kerosene.

The FKCCI, in a press note, said the Centre's decision would further heighten the inflationary pressure on the economy.

“What is worrying is that the current hike came just a day after India's food inflation soared to a 10-week high of 9.13 per cent for the week ended June 11, 2011,” the note said.

Increase in fuel prices would have a cascading effect on various sectors, the FKCCI added.

Terming the current revision as “unwarranted” and not in the interests of the common man, the All-India Motor Transport Congress (AIMTC) stated that more than 50 per cent of the differential between the landing cost of the crude and retail price of diesel was on account of various taxes, including customs duty, excise, countervailing duty, VAT, Central and State taxes, educational cess and infrastructure development tax.

Rollback sought

AIMTC president G.R. Shanmugappa urged the Government to roll back the diesel hike.

The Federation of Karnataka Lorry Owner's Association has also condemned the increase in diesel prices, saying it will affect the transporters in particular and the economy in general.

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