Petrol prices: Mamata gives ultimatum, other allies upset, Congress looks for ’healing touch’

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Kolkata, Nov 4, 2011: Mamata Banerjee has warned the Congress that if it doesn’t withdraw the petrol price hike introduced last night, she may have to opt out of the government. Other allies like the NCP and the National Conference want the hike reviewed and the ruling Congress has joined that expression of concern. Party spokesman Abhishek Manu Singhvi said the party hoped the government would look into the matter seriously and consider giving the people some relief. 

While Mamata Banerjee and other allies have vocally demanded that yesterday’s price hike be withdrawn, sources say many in the Congress want a rollback too. Party leaders are waiting for the Prime Minister to return to the country tomorrow before they hold a meeting on the political ramifications of the hike and next steps. Mr Singhvi said he believed the government would not be happy at the situation, was doing its best and would provide some "healing touch."

Like the allies, the Congress has political compulsions. A number of states will see elections in the next few months and the Congress’ "aam aadmi" plank will be difficult to balance with petrol now costing Rs. 17 more than it was at the beginning of this year.
 
In Kolkata today, after meeting with senior MPs from her party, Mamata Banerjee said her party had not been consulted about the hike, and that her MPs are willing to quit the UPA if they are excluded from decisions like this one which affect the common man. "There is no way our MPs can defend this to our people," she said. 
 
Ms Banerjee said she will take a final call on her party’s participation in the Cabinet and the government after she meets with the PM upon his return from the G20 summit in Cannes. 
 
"The price hike may not affect the Centre or Delhi but it affects our people...we stand by the people," Ms Banerjee said, underscoring that the prices of fuel and products like cooking gas and kerosene have been raised 11 times in the last few months.  "We don’t want to blackmail anyone, but we have tolerated a lot," she warned. With her 18 Lok Sabha MPs, Ms Banerjee is the Congress’ largest ally and an indispensable part of the UPA.   Ms Banerjee after the press conference was smiling and relaxed, and urged reporters not to sensationalize her message to the government.
 
She may have delivered that message with restraint - she is known for her impatience and short temper - but her point was not subtle.   Underscoring that the Congress needs her and not the other way around, she said that she can run the government in West Bengal without the Congress’ support, but her party is key in propping up the UPA at the Centre. 
 
This morning, Railways Minister Dinesh Trivedi who is from the TMC said the party had "not even been informed over the phone" about the new petrol hike.  Referring to Mr Trivedi’s position in the Cabinet, Ms Banerjee said "For one minister, we are not going to be part of the government if it does not correct its ways."   
 
The latest petrol price hike of Rs. 1.82 - the second in two months - has created a new friction between the Congress and its main allies in the UPA coalition at the Centre.  A friction the Congress wants to play down.

Farooq Abdullah’s National Conference, Sharad Pawar’s Nationalist Congress Party (NCP) and Ms Banerjee’s Trinamool Congress (TMC) have all said they do not support the new price rise, and were not consulted by the Congress.  Mr Pawar’s party says it will formally convey its objections to the Prime Minister, and take a decision at the next Cabinet meeting.
 
Abhishek Manu Singhvi said he did not view the allies’ words, including Mamata Banerjee’s threat, as a disruptive or divisive attempt. The Congress, he said, was "sensitive towards allies," and added that the Congress was confident the government would take steps to address those concerns on price rise.

So far, petrol prices have been increased five times this year.  They were last increased in September by Rs. 3.14.     So now, in Delhi, petrol costs Rs. 68.64 as compared to Rs. 58.37 in January.  Bangalore is hit the worst; it now pays Rs. 75.64 per litre.

The government in June last year deregulated or freed petrol from all price controls.  State-owned oil companies - Indian Oil, Hindustan Petroleum Corporation Limited (HPCL) and Bharat Petroleum - say they are facing losses of Rs. 333 crore a day. They say the latest price hike was the result of rising crude oil prices and a weaker rupee.

The BJP and other opposition parties have described the latest petrol price hike as "midnight massacre." The government is insensitive to the need of the common people, said BJP leader and former Finance Minister Yashwant Sinha.

Courtesy: NDTV