Consumer goods companies are apprehending a dip in demand due to petrol price hike and an imminent increase in diesel prices that are adding pressure to customers, who are already reeling under the recent spike in interest rates.
Police used water canons to disperse a group of Bharatiya Janata Party protesters when they tried to break barricades to march towards Parliament to protest the hike in petrol prices.
Despite the steep hike of Rs 20 per LPG cylinder announced last week, domestic cooking gas in India is still the cheapest in the subcontinent.
Mamata Bannerjee, a key United Progressive Alliance constituent, has put the cat amongst the pigeons by demanding that the UPA set up a co-ordination committee to discuss important issues and decisions before they are made and implemented. She said the recent petrol price hike was undertaken without her consent.
Flaying the Congress-led United Progressive Alliance government at the centre, and holding it responsible for the unabated price rise, BSP leaders made it a point to stress that, "none other than Mayawati can bring down the prices in the country."
Increasing the duties on auto parts and putting an additional cess on petrol and diesel could drive up costs of vehicles, specially where volumes are low and localisation is not viable.
If June 2010 diesel price is taken as the base, then the increase is a mere 2 per cent. By contrast, petrol prices have gone up by 23 per cent in the same period.
Finance minister Pranab Mukherjee, is also believed to be in favour of decontrolling auto fuel prices to limit the government's subsidy outgo but a decision is unlikely in the next 7-10 days as United Progressive Alliance managers build political consensus on the issue, an oil ministry official said.
Maruti Ciaz and Ertiga are exempt from the infrastructure cess and so, there is no change in the prices of these models.
Rajya Sabha proceedings were adjourned for the day on Monday amid protests by Opposition parties over their demand to revoke the suspension of 12 members of the House.
Samajwadi Party on Thursday accused the Uttar Pradesh government of using dirty drain water to disperse protesting SP workers during the Bharat bandh on Monday.
The government had, on June 25, freed petrol price from its control resulting in a hike of Rs 3.50 per litre.
The government on June 25 deregulated petrol price and said the same for diesel will be done soon. But with inflation rate continuing to remain at unmanageable levels, the government put-off the decision as any further hike in diesel price would lead to cascading effect.
Food inflation further eased to 16.04 per cent for the week ended April 24, as arrival of rabi (winter) crops cooled down prices of essential items.
Wall Street brokerage Bank of America Securities has pencilled in lower than the consensus retail inflation for the current fiscal year at 5 per cent, but higher than the previous forecast of 4.7 per cent. Stating that the June print will be critical for the future trajectory -- after the extremely high 6.3 per cent print in May, the brokerage in a report on Friday revised upwards its forecast by 30 bps to an yearly average of 5 per cent for the year to March 2022. "Though the June print will be critical for future trajectory, beyond near-term, we find some comfort from our analysis of four key factors that are likely to influence CPI inflation the most.
The decline in food inflation is mainly because of falling prices of pulses, wheat and potato, according to the official data released on Thursday.
State-owned fuel retailers, who control 95 per cent of the petrol pump sales, sell diesel at government-fixed rates, which are way lower than the cost of production.
Hitting out at the government, BJP on Wednesday scored a "double century" on price rise and questioned the "silence" of Congress President Sonia Gandhi on the "burning issue".
On the other hand, mobile accessories, medical equipment energy efficient CFL lamps, set top boxes, compact disc, toys and books will be cheaper on account of some tax concessions offered on these items by Finance Minister Pranab Mukherjee in the Union Budget for 2010-11.
Much before the honeymoon ended with the public, the Manmohan Singh government delivered a shock in the form of the fuel price hike -- an act of confident UPA -- to compensate the losses of 2010 Union budget.
After briefly maintaining prices at par with public sector oil marketing companies following the June 25 price hike, private fuel retailers Essar Oil and Reliance Industries are selling petrol and diesel at a premium of Rs 0.50 to 2.50 per litre in some states.
Petroleum retailers in Delhi, Mumbai, Chennai, Kolkata, Bangalore, Hyderabad and Ahmedabad, among other cities, will start supplying Euro-IV compliant auto fuel from April 1.
Acknowledging that the Union government had its own pressures in increasing petrol and diesel prices, Tamil Nadu Chief Minister M Karunanidhi, whose party DMK is a key UPA ally, said on Wednesday that it would persuade the Centre to roll back the prices.
What effect is the Budget going to have on your daily life? Find out how what's cheaper and what's costlier after the Budget.
