The government on Sunday ruled out rolling back increase in fuel prices, even as Opposition NDA called for an all-India bandh on Monday to protest the price hike and rising inflation.
"No question of roll-back," finance minister Pranab Mukherjee told reporters on the sidelines of an Assocham function here, when asked whether the government could review its June 25 decision of raising prices of petroleum products.
Meanwhile, NDA Working Chairperson L K Advani after a meeting of its leaders, said, "This may be the first time in the history of India's politics that almost all political parties will participate in the Bharat Bandh."
The government last month raised prices of petrol, diesel and kerosene by Rs 3.50, Rs 2 and Rs 3 a litre, respectively and increased the rate of cooking gas by Rs 35 a cylinder. The decision was taken by the empowered group of ministers headed by Mukherjee.
The government on June 25 decided to give freedom to the oil marketing companies to fix prices of petrol. Prime Minister Manmohan Singh a few days later indicated that diesel prices could also be freed in due course. Under the now extanct system, government determined prices of petroleum goods.
The hike in prices of petroleum goods is likely to have a cascading effect on inflation, which is ruling high.
Wholesale prices-based inflation crossed double digits (10.16 per cent provisionally) in May, but as per final figures, the rate of price rise has been 11 per cent or more since February. Food inflation eased to 12.92 per cent in the third week of June from above 16 per cent.
Reserve Bank of India (RBI) on Friday raised the short- term lending and borrowing (repo and reverse-repo) rates by 25 basis points to 5.5 per cent and 4 per cent respectively to check inflation.
According to economists, the central bank could even further tighten the money supply in its monetary policy which is scheduled to be announced on July 27.PTI
