Gluttons for oil
The government has now decided to raise the price of oil in India but nobody is talking about conserving oil. The only major reaction we have got from our political leaders is a resignation in protest against the price hike from railways minister Mamata Bannerjee.
Her argument is simple. The hike in the price of diesel will raise fares. Therefore Mamata Bannerjee will have to risk unpopularity while presenting the new railway budget. The fear of unpopularity is all that worries our leaders but no serious attempt is being made to find out what is wrong with the Indian situation.
The use of oil, coal and gas is highly inefficient in India as compared to other countries. Seventy per cent of India's crude is imported. The import bill which was around Rs 53,000 crore is expected to be around Rs 80,000 crore this year. Most of this will be due to the hike in international prices of crude. Some of it due to the increasing consumption of oil. Meanwhile India's political leadership continues to blindly support a subsidy regime that would give an accountant nightmares. Oil is highly subsidised in the name of the poor in India. But the poor hardly get to benefit from this. The rich urban middle class uses diesel and lpg to run their cars and tiled kitchens.
To add to its woes, the entire energy sector still suffers from the problems of nationalisation. For every unit of power produced, four times more fuel is used in India as compared to Japan and twice more than usa . The steel and cement industry are also glaring examples of inefficient energy use, using twice as much energy as Japan and the us to produce the same amount. Experts say that it is possible to save 30 to 35 per cent of energy consumed by the industrial sector. It is also becoming clear today that the biggest barrier to the commercialisation of renewable energy in India is political. The government of India spends more than us $4 billion to virtually give away conventional energy. As long as this goes on the outlook of renewable energy can hardly improve and there will be no incentive on the part of anybody to conserve energy and use fossil fuel more efficiently.
Mamata Bannerjee is no different from any Indian politician. In the name of seeking to subsidise the poor they end up subsidise the rich.