Protests against petrol price hike are completely unjustified

It may sound harsh, but there’s no running away from it. Whichever way you look at it, it’s a betrayal. The angry public reaction to the petrol price increase is, in my opinion, completely self serving, capricious and, ultimately, self defeating.

Why is the middle class reneging on its unspoken compact with the government? The philosophy of India’s economic reforms programme rests on a simple premise:

* The government will create an enabling atmosphere for businesses to flourish;

* This will create an eco-system where investors and other stakeholders (like employees of companies, self-employed individuals, professionals and others) can legitimately increase their incomes and improve their standards of living;

* The increased all-round prosperity will allow individuals who have benefitted from reforms to pay user charges for most public services;

* This, in turn, will allow the government to prune subsidies and divert precious resources to more productive uses and to increase outlays on welfare schemes for those sections of society that need support.

Petrol is a fuel that is used only by the middle class and the rich. The only machines that use petrol to any great extent are:

* Cars
* Two-wheelers
* Portable generator sets

The poor don’t use any of these. The middle class and the rich do.

And these classes have been the biggest beneficiaries of economic reforms. The dismantling of socialism has opened up massive new opportunities – both for job-holders/seekers as well as for those who want to strike out on their own.

Prosperity hasn’t just trickled down the privilege ladder; it has cascaded down in torrents that have swept away the pusillanimity of socialist delusion and replaced it with the can-do, will-do approach of the new Indian middle class.

Please don’t misinterpret this: not for once am I saying that every Indian has benefitted equally. I accept that large swathes of our fellow Indians have been left behind by economic reforms. But they aren’t petrol buyers. And this blog is limited to the issue of the petrol price hike.

(For the record, I firmly believe that those Indians – tribals, farmhands and unorganized sector workers – who are feeling left behind will benefit immensely if the government

* Musters up the courage to take on the green/activist lobby that is holding practically every steel, power and mining project to ransom;
* Allows FDI in retail;
* Liberalises the farm sector; and
* Reforms archaic and self-defeating labour laws that now come in the way of industrial expansion and job growth.

But these can be the building blocks of another blog; so more of these later).

I can confidently wager that a vast majority of petrol users in this country have benefitted immensely from economic liberalisation.

So much so, that the “luxuries” so derided by sterile socialist minds, have become the necessities of today.

I remember those terrible, dark days (in the ’70s and ’80s) of deprivation, desire and want – when foreign-returned relatives were badgered for bottles of Scotch whisky, bars of Camay soap, cans of Coca-Cola (Pepsi Cola was still an unknown quantity that one saw occasionally, and fleetingly, in English movies) and, if the relative was really generous, a pair of Wrangler or Levis jeans.

And Indians travelling abroad were mostly looked upon as illegal immigrants, pile-ons or Heathrow toilet cleaners.

For most petrol users (at least), those days are now part of an unpleasant past. An entire generation and more of Indians have no experience or memory of those years of politically-generated want.

Over the last 21 years, an overwhelming majority of Indians (petrol buyers, at least) have made the most of the opportunities thrown open by reforms and have upgraded their standards of living manifold.

Such beneficiaries have no right to be affronted by the increase in petrol prices whose economic logic is self apparent. The central government has rightly refused to roll back the price hike.

I am now praying that the government musters up the courage to prune the list of beneficiaries who get subsidised food grains and other essentials under the PDS. And why should the middle class and the rich get LPG cylinders at less than the market price?

There’s no economic or political logic for this list of entitlements.

Sure, there will be protests – as there have been. After all, no class of beneficiaries has ever given up its entitlements without a murmur.

The government’s newfound resolve to look the protestors in the eye gives me hope. Maybe, just maybe, it has cobbled together the nerve to do the right thing.