The government has decided to change the game when it comes to the prices of fuel. Starting May 1, five cities in India will see prices of petrol and diesel change daily, depending on the international price of crude oil. If the experiment is successful in Puducherry, Vizag, Udaipur, Jamshedpur and Chandigarh, then it will become a nationwide move.
There are many more positives than negatives in this move. Firstly, although government controlled agencies control over 80 percent of the market, the companies themselves will change the prices daily, irrespective of whether there are elections on or not. This politicisation of prices was an issue in the past, when governments would not allow prices to be changed in states that were going to elections. Even if there is a price change, it’s not going to be more than a few paisa everytime. The only time a major increase or decrease will take place, will probably be during a serious international incident. That will not be helped and it would affect the prices even if we were using the system of old. What this will do is free up the sector for more private players to come in, which might see a change in the way the industry treats consumers.
