Subsidies of crude oil is ment for rich.....not for poor

                            
It he wake of the recent increase in petrol prices and India’s growing fiscal deficit situation, it is important to understand why diesel prices should also be revised upwards.
For several decades, India has been subsidising the price of diesel. But in recent years, both the global environment and the Indian economic scene have undergone substantial changes.
Despite this, many economic policies, such as the heavy subsidy on diesel prices, have remained unaltered over the period,this needs serious reconsideration.
For ex:  in the last six years, the average growth rate of crude oil prices (based on the Indian basket) has been at 13.5 per cent.
During the same period, however, the average value of diesel under-recoveries, as a percentage of fiscal deficit, stood at 14.6 per cent!
Similarly, between 2009 and 2010, when global oil prices fell by more than 21 percentage points, diesel under-recoveries as a percentage of fiscal deficit fell only by 13 percentage points.
What is wrong in subsidising diesel?
It is vital to understand that subsidies are associated with two important (negative) economic fallouts, besides many others.

First, a subsidy of any kind involves a disincentive to use the subsidised good or service efficiently as they have been obtained cheap.
Second, the government can finance a subsidy only by expanding its fiscal deficits. In the process, scarce resources are transferred from a private party (tax-payers) to the government.
It is well documented that owing to the absence of a profit motive in government spending, such resource transfers leads to decreased productivity.
Revision in diesel prices, no doubt, would entail temporary displeasure, and resistance from the pubic and political parties. But it would only help the country’s cause to keep political interest aside, and focus on the economic benefits.
In the name of shielding the economy from fuel price volatility, the government is exposing future generations to tougher times. It is time people realise this fact.
The Government may also want to look back at the heavily resisted policy shifts in the 1990s that has created a lot of positive changes in the Indian economy.


source: some statistics has been taken from frontline and economic survey of india.

definitions:
fiscal deficit : government's total expenditures minus the revenue that it generates
diesel under-recoveries: the amount of money that is being given away by govt refineries to corporate refineries in the name of subsidies.

Prime minister of India----speech on recent policy changes.

My dear brothers and sisters,

I am speaking to you tonight to explain the reasons for some important economic policy decisions the government has recently taken. Some political parties have opposed them. You have a right to know the truth about why we have taken these decisions.

No government likes to impose burdens on the common man. Our Government has been voted to office twice to protect the interests of the aam admi.

At the same time, it is the responsibility of the government to defend the national interest, and protect the long term future of our people. This means that we must ensure that the economy grows rapidly, and that this generates enough productive jobs for the youth of our country. Rapid growth is also necessary to raise the revenues we need to finance our programmes in education, health care, housing and rural employment.

The challenge is that we have to do this at a time when the world economy is experiencing great difficulty. The United States and Europe are struggling to deal with an economic slowdown and financial crisis. Even China is slowing down.

We too have been affected, though I believe we have been able to limit the effect of the global crisis.

We are at a point where we can reverse the slowdown in our growth. We need a revival in investor confidence domestically and globally. The decisions we have taken recently are necessary for this purpose.

Let me begin with the rise in diesel prices and the cap on LPG cylinders.

We import almost 80% of our oil, and oil prices in the world market have increased sharply in the past four years. We did not pass on most of this price rise to you, so that we could protect you from hardship to the maximum extent possible.

As a result, the subsidy on petroleum products has grown enormously. It was Rs. 1 lakh 40 thousand crores last year. If we had not acted, it would have been over Rs. 200,000 crores this year.

Where would the money for this have come from? Money does not grow on trees. If we had not acted, it would have meant a higher fiscal deficit, that is, an unsustainable increase in government expenditure vis-a-vis government income. If unchecked, this would lead to a further steep rise in prices and a loss of confidence in our economy. The prices of essential commodities would rise faster. Both domestic as well as foreign investors would be reluctant to invest in our economy. Interest rates would rise. Our companies would not be able to borrow abroad. Unemployment would increase.

The last time we faced this problem was in 1991. Nobody was willing to lend us even small amounts of money then. We came out of that crisis by taking strong, resolute steps. You can see the positive results of those steps. We are not in that situation today, but we must act before people lose confidence in our economy.

I know what happened in 1991 and I would be failing in my duty as Prime Minister of this great country if I did not take strong preventive action.

The world is not kind to those who do not tackle their own problems. Many European countries are in this position today. They cannot pay their bills and are looking to others for help. They are having to cut wages or pensions to satisfy potential lenders.

I am determined to see that India will not be pushed into that situation. But I can succeed only if I can persuade you to understand why we had to act.

We raised the price of diesel by just Rs. 5 per litre instead of the Rs 17 that was needed to cut all losses on diesel. Much of diesel is used by big cars and SUVs owned by the rich and by factories and businesses. Should government run large fiscal deficits to subsidise them?

We reduced taxes on petrol by Rs. 5 per litre to prevent a rise in petrol prices. We did this so that the crores of middle class people who drive scooters and motorcycles are not hit further.

On LPG, we put a cap of 6 subsidised cylinders per year. Almost half of our people, who need our help the most, actually use only 6 cylinders or less. We have ensured they are not affected. Others will still get 6 subsidised cylinders, but they must pay a higher price for more.

We did not touch the price of kerosene which is consumed by the poor.

My Dear Brothers and Sisters,

You should know that even after the price increase, the prices of diesel and LPG in India are lower than those in Bangladesh, Nepal, Sri Lanka and Pakistan.

The total subsidy on petroleum products will still be Rs. 160 thousand crores. This is more than what we spend on Health and Education together. We held back from raising prices further because I hoped that oil prices would decline.

Let me now turn to the decision to allow foreign investment in retail trade. Some think it will hurt small traders.This is not true.

Organised, modern retailing is already present in our country and is growing. All our major cities have large retail chains. Our national capital, Delhi, has many new shopping centres. But it has also seen a three-fold increase in small shops in recent years.

In a growing economy, there is enough space for big and small to grow. The fear that small retailers will be wiped out is completely baseless.

We should also remember that the opening of organised retail to foreign investment will benefit our farmers. According to the regulations we have introduced, those who bring FDI have to invest 50% of their money in building new warehouses, cold-storages, and modern transport systems. This will help to ensure that a third of our fruits and vegetables, which at present are wasted because of storage and transit losses, actually reach the consumer. Wastage will go down; prices paid to farmers will go up; and prices paid by consumers will go down.

The growth of organised retail will also create millions of good quality new jobs.

We recognise that some political parties are opposed to this step. That is why State governments have been allowed to decide whether foreign investment in retail can come into their state. But one state should not stop another state from seeking a better life for its farmers, for its youth and for its consumers.

In 1991, when we opened India to foreign investment in manufacturing, many were worried. But today, Indian companies are competing effectively both at home and abroad, and they are investing around the world. More importantly, foreign companies are creating jobs for our youth -- in Information Technology, in steel, and in the auto industry. I am sure this will happen in retail trade as well.

My Dear Brothers and Sisters,

The UPA Government is the government of the aam aadmi.

In the past 8 years our economy has grown at a record annual rate of 8.2 per cent. We have ensured that poverty has declined much faster, agriculture has grown faster, and rural consumption per person has also grown faster.

We need to do more, and we will do more. But to achieve inclusiveness we need more growth. And we must avoid high fiscal deficits which cause a loss of confidence in our economy.

I promise you that I will do everything necessary to put our country back on the path of high and inclusive growth. But I need your support. Please do not be misled by those who want to confuse you by spreading fear and false information. The same tactics were adopted in 1991. They did not succeed then. They will not succeed now. I have full faith in the wisdom of the people of India.

We have much to do to protect the interests of our nation, and we must do it now. At times, we need to say "No" to the easy option and say "Yes" to the more difficult one. This happens to be one such occasion. The time has come for hard decisions. For this I need your trust, your understanding, and your cooperation.

As Prime Minister of this great country, I ask each one of you to strengthen my hands so that we can take our country forward and build a better and more prosperous future for ourselves and for the generations to come.

Jai Hind.

Motivational quote

Life is 10% of what happens to me and 90% of how I react to it - John Maxwell

Motivational Quote

Take chances, make mistakes. That's how you grow. Pain nourishes your courage. You have to fail in order to practice being brave – Mary Tyler Moore

poverty is a big demon in the world

Among all the 6.96 billion people, around half of the people are reeling under severe poverty . These people are starting their day in search of feeding their belly at the end of the day. If we think, why these people are struggling even for food while this world contains the capability of feeding all, our mind will land on some disparities which were created by our ancestors. These disparities arose out of class conflicts in different  societies. Anthropogenic , cultural, geographical, economical factors have played crucial role in dividing people into different groups. Over the years together when civilization is flourishing the exploitation of minority  of people over majority of people has been reached it's peak. The 40% of population has been enjoying the luxury and making the wealth to be concentrated leaving 60% of population in poverty. The disparity of rich and poor has been disrupting the balanced cycle of economy and ecosystem which in turn will give adverse affects in near future.   

THE FATE OF OUR BACKBONE

         We, the people of India, completely dependent on agriculture sector  for ensuring self sufficiency in feeding our huge population. India is equipped with 121 crore population and also in the progress to get the first place of most populated countries in near future. The major challenge that we are going to face is nourishing our huge population.Today out of 121 cr population 70% of population involved in agriculture and allied activities and almost all of them are small and marginal farmers and labour workforce.But, paradoxically the share of agriculture, which is feeding 70% of population, in GDP is 14.2%(2010-2011). when 100 people involved in country's progress 70 members are remunerated with Rs 14 and 30 members are compensated with Rs 86. This scenario creating a big barrier between agri and non-agri earnings.The govt of India also showing stepmother attitude towards agriculture.
 

 
       After our independence federal govt introduced land reforms to distribute land to poor and downtrodden from jamindars and govt land but these reforms ensured no distribution and completely failed bcz agriculture is a state subject and the initiator of these reforms was center govt . Almost all states showed o% interest to implement land reform schemes except west bengal and kerala. After land reform schemes the major scheme was green revolution. Green revolution is one which made us self-sufficient but at the same time the mismanagement of green revolution made our agriculture fields infertile(bcz of over usage of fertilizers and pesticides) and it has widened the gap between one region to other region by restricting this scheme to some particular areas only. The areas which have not seen the green revolution have been fighting for their self recognition today(Telangana, Vidarba, some parts of central India and whole of north eastern states). After this, i feel the major initiative was the present MGNREGA(Mahatma Gandhi National Rural Employment Guarantee Act) which played a crucial role to bring the UPA govt again to helm of Indian affairs. This NREGA programme   has guaranteed the rural people with minimum of 100 days work per year. This is a very good initiative and everyone has to appreciate this initiation but the implementation of this programme has been carrying unproductive work and it made labour resources costlier and scarce to farmers. The nature of this programme inculcating laziness to work force.

     The recent price hike of crude oil and nitrogen,phosphorus and potassium compounds in the global market has raised the input cost for agriculture to sky. In addition to all these our farmers have been facing problems of monsoon vagaries also and there is no proper system to maintain drought and floods.

     With all these constraints Indian brave hearted tiller continuing his duty and completing the harvest with good production. But, the post harvested output has been looted by millers and middle men. Government also supporting the middlemen with it's funny export policies. At the end of every financial year farmers are being left with nothing and the little growth of agriculture sector is being stashed away to corporate people. This is a vicious cycle that existed in our present society. This vicious cycle should eradicated from the grassroots.To eliminate this menace i can suggest the following structural changes.
              1. The land reforms should be re-implemented with full dedication in all India level and the responsibility of implementing this reforms should be vested with a separate body with honest bureaucrats controlled by union govt and the recommendations of this body shall be binding on part of state govt.
              2.The green revolution strategy should be extended to uncovered ares and the practice of this scheme should redesign in harmony with ecosystem by promoting organic manure,bio-fertilizers with minimum usage of synthetic fertilizers.
              3. Irrigation facilities should be provided equally to all regions. For this purpose the interlinking of northern perennial rivers to the south non-perennial rivers should be given more attention.
             4. well processed seeds and subsidized fertilizers should be given with proper regulated distribution systems.
             5.The middlemen system in the procurement of agriculture output should be abolished strictly.
             6. Godowns and cold storage linkages should be increased.
             7.Global and domestic markets should be monitored on regular basis.
             8. Agriculture research institutes should be updated with modern infrastructure and the allocation for R&D in agriculture in annual budget should be increased.
             9. Gap between farmer and agricultural universities should be reduced.

         The tiller, who tills the land for feeding the entire country, is now starving his belly. It is every Indian responsibility to protect our farmer for well-being of the whole nation. As a son of farmer i have given my understanding here. I am inviting you to share your knowledge regarding this issue. Please discuss about this topic with your family members and colleagues and with other members when situation favors. I hope this way we can promote awareness and stimulate everyone to support the life of our nation.        

 

             

PLEASE RESPECT WOMEN

    I am not able to understand whether human civilization is flourishing with noble values or plunging into evil by continuing atrocities and sexual molestation against women and children. These inhuman activities have become very common and regular to every society(economically developed, developing, underdeveloped) with varying level of crime nature.women in Arab countries are suffering from different forms of deprivation, stringent and ruthless punishment like stone on to death for crimes like adultery, but punishment for the same crime committed by men is not in cope with of women punishment .

    The recent events which hurt me a lot was taken place in Bangalore and Guwahati. In Bangalore a France diplomat charged under sexual molestation against his own daughter on the report given by his own wife. And in Assam around fifteen persons attacked on a 17-year-old girl outside of a bar in full public view was an example for our shamelessness where all people around that incident were watching the event out of fear and one local media channel started video recording of that brutal sexual molestation instead of stopping them, latter when media persons were asked about recording, they replied that they did it in the interest of public.Do they behave like so, if that girl is their own sister or relative. This is the sorry state of our media behavior and they killed the essence of journalism with that irresponsible answer. These kind of incidents we can notice on news paper on regular basis around the world.With one or other reason women is always being victimized in the hands of men.

    I have cited only few examples just to indicate the culture that we are inculcating in our next generations. All together we are ruining our social structure instead of preserve and flourish it.


       WE ARE NOT DESERVED PEOPLE TO CLAIM OURSELVES AS CIVILIZED UNTIL UNLESS WOMEN BEING RESPECTED IN THE SOCIETY WITH SACRED FEELINGS.