Deals and doubts

Published : Aug 26, 2005 00:00 IST

India's tilt towards the United States, especially in the context of the invasion of Iraq, is beyond one's understanding ("Deals and doubts", August 12). There is no need for a country of our size and strength, including nuclear capability, to submit to U.S. arm-twisting.

S. Raghunatha Prabhu Alappuzha, Kerala* * *

Notwithstanding the euphoria about the growing affinity between India and the U.S., we should be clear that nothing from the U.S. comes without a price. The change in the U.S.' perception about India arises more from its larger interests than the intention of helping India "become a major world power".

Dhirendra Mishra Allahabad, Uttar PradeshJudging judges

Against the backdrop of deviant behaviour by some judges in recent times, the United Progressive Alliance government's decision to introduce the draft Judges (Inquiry) Bill facilitating the speedy removal of erring judges, is a welcome, progressive move ("To probe judges", August 12).

Arvind K. Pandey Allahabad, Uttar PradeshLokayukta

The interview with Justice N. Venkatchala was informative ("Lokayukta in action", August 12). For eradicating corruption the institution of Lokayukta should be strengthened with suo motu powers to proceed against anyone.

Nithin Chandran Kannur, KeralaSaffron agenda

In the five years of BJP rule voices against the saffronisation of education have often been raised and stifled ("Stifled by the saffron agenda", August 12). D. Bandyopadhyay should be commended for unmasking the surrender of prestigious institutions to the whims and fancies of the ruling dispensation of the time. There is an urgent need for the government to ensure that the education system remains free from such prejudices.

Shadab Mansoori Dehradun, UttaranchalTaj controversy

The two most outrageous things about the recent controversy around the Taj Mahal are the audacity of the Sunni Waqf Board in staking a claim to a national treasure as its "property" and the lack of a strong, united voice of condemnation from the entire political class ("A claim to the Taj", August 12). The status quo of the Taj Mahal should not be allowed to be disturbed by anybody. The Archaeological Survey of India, the present custodian of the monument, is doing a splendid job. There is no reason why it should not remain the caretaker of the Taj.

S. Balakrishnan Jamshedpur, Jharkhand* * *

In what sense did Shahjahan build the Taj? He was neither an architect nor a designer. He only financed the project. He had the money because he was the king at the time; he exploited the resources of the land (both human and material) as kings do, and engaged in conquests and campaigns to keep his treasury filled. Shahjahan could reportedly set up a wakf for the upkeep of the Taj and endow it with the revenue from 30 villages and numerous inns and markets only because he was the king.

C.M. Naim Chicago, U.S.* * *J.S. Acharya Hyderabad* * *Mahesh Kapasi New Delhi* * *P.C. Sahajwala New DelhiTies with Singapore

This is with reference to the article lauding the achievements of the agreement between Singapore and India ("A treaty and a message", July 29). It is a matter of regret that Indian workers in Singapore are paid well below the national average wage and the workers from China. The Indian community that has been in Singapore since the city's birth in the 19th century are still treated as second class citizens.

M. Ahmed Sydney, AustraliaJinnah in India's history

For a fair assessment of Mohammad Ali Jinnah as a statesman, one should read Jallianwala to Rajghat in five volumes by K.L. Mahaley (Morley Book Agency, 6, Mrunmayi, Park-naka, Kalyan 421 301). The author offers a full perspective of Indian history for the period 1919-1948 ("Jinnah in India's history", August 12).

Nitin More MumbaiWeakening welfare

Privatisation does not necessarily mean investing in the stock market ("Weakening welfare", August 12). The writer misses the fact that social security needs to be fixed. Theoretically speaking, if I, as a non-resident Indian working in the U.S. for the past five years, return to India the amount paid into my bank account would be "my money" which I can use only after my retirement. By the current system I would have paid into the system but would not get any benefits. If a person dies at the age of 40 leaving his wife and children, social security would not pay anything to the family. With private accounts the money is passed on to the family. The money paid into the private accounts need not be invested in the stock market; it is an individual decision how much risk one wants to take. Privatisation is only a part of social security contribution, subject to a maximum of 4 per cent.

Arvind Kidambi North Carolina, U.S.Back to Ayodhya

The statement that Advani is going `back' to the Hindutva agenda itself is wrong ("Back to Ayodhya", July 29). His recent statements were made not out of conviction but because of political compulsions, an attempt to secure more votes.

Hari Virudhunagar, Tamil NaduImrana's story

Though the case of Imrana is a social issue, it has been given a religious colour ("Fighting for Imrana", July 29). Even if it is written in the religious law that a woman cannot live with her husband after being raped, such laws should be removed and religious fundamentalists should not be allowed to rule the roost.

Viji Ganesh Madurai, Tamil Nadu* * *

The responsibility lies with the law-enforcing agencies to investigate the case and submit a final report. Let the Indian criminal law take its own course and the culprit be punished. The authenticity of the allegation should have been verified before a fatwa was issued.

Ruby Nisha New DelhiOil price

The article on petroleum products has inter alia raised certain doubts about the revenue neutrality of this year's budgetary changes in customs and excise duties for the petroleum sector and its impact on the prices of petroleum products ("Common man's burden", July 29). The article mentions that:

The Finance Ministry, rather than the Petroleum Ministry, was the motive force behind the move to hike prices; this year's budgetary changes in customs and excise duties for the petroleum sector were not revenue neutral, and in fact they were revenue positive as per the deposition of the Petroleum Secretary before the Parliamentary Standing Committee for Petroleum and Natural Gas; and the changes in excise duty on petrol and diesel were the prime reasons for the recent price hike.

These observations give the impression that the changes in the duty rates and structures in the petroleum sector were not revenue neutral and thus necessitated an increase in prices of petroleum products. This impression is, however, contrary to facts.

In the Budget speech 2005-06, the Minister of Finance has explicitly stated that the proposed changes are revenue neutral and he was assured (by the Ministry of Petroleum and Natural Gas) that there would be no increase in the retail prices of petroleum products as a result of changes in the duty structure (Para 140). The Minister of Petroleum and Natural Gas has also indicated to the press that he was convinced that the changes in customs duty and excise duty were revenue neutral.

The government had constituted an Advisory Group to review the customs and central excise tariff structure on crude petroleum and petroleum products, and to suggest changes in the duty structure. The Ministry of Petroleum and Natural Gas was also represented in the said Advisory Group.

The Advisory Group's recommendations were examined by Ministry of Finance in consultation with the Ministry of Petroleum and Natural Gas. It was accordingly agreed to effect the following changes in duty rates while ensuring revenue neutrality of the overall duty changes:

The significant reduction in customs and excise duty on crude and petroleum products would on the one hand benefit the petroleum sector while, on the other hand, lead to revenue loss to the exchequer. To compensate for the revenue loss and to make the duty changes revenue neutral, excise duty on petrol and diesel was accordingly suitably adjusted. Therefore, it is not correct to say that the duty changes were not revenue neutral.

Besides the above changes, to generate additional funds for the development of national highways, Additional Excise Duty (AED) on petrol and diesel was increased by 50 paise per litre, which are earmarked exclusively for the development and maintenance of national highways. The Finance Minister had made this amply clear in his Budget Speech (para 135).

Data on revenue collection from the petroleum sector for the period April-May 2005 clearly indicate that there has been no significant increase in revenue due to changes in duty rates. Provisional figures of revenue collection for this period, both customs and central excise duties, show a growth of about 4 per cent compared with the corresponding period of last year as against growth in overall customs and excise revenue of about 16 per cent. Growth in revenue from non-petroleum products during this period was about 24 per cent.

The duty changes in the Budget on petroleum products have been undertaken in close coordination and consultation with the Ministry of Petroleum and Natural Gas, ensuring complete revenue neutrality. The revenue trend clearly indicates that the duty changes have not put any additional burden on the petroleum sector. On the contrary, revenue collection from the petroleum sector for the period April-May 2005 indicates that the share of revenue from this sector has declined.

To sum up, petroleum prices being dependent on a number of factors, it would not be correct to say that the Finance Ministry, rather than the Petroleum Ministry was the motive force behind the move to hike price and that duty changes are not revenue neutral.

B.S. Chauhan Director, Public Relations, Press Information Bureau, Government of India

V. Sridhar writes:

Two sets of issues have been raised. The first relates to whether the recalibrated rates will be revenue neutral. Although the Finance Ministry has asserted that the new excise rates will be revenue neutral, officials of the Petroleum Ministry have categorically stated that they will indeed be "revenue positive". In fact, the Petroleum Ministry had informed the Standing Committee of Parliament that the realigned rates will result in petrol being dearer by Rs.2.52 a litre and diesel by Rs.1.65 a litre. If the recalibrated rates do result in dearer petroleum products it also implies that the Finance Ministry (which adjusts rates) is the motive force behind the price rise.

The other issue relates to whether the government is unduly dependent on collections from the petroleum sector. The figures given by B.S. Chauhan relate to April and May 2005. However, petroleum product prices were increased only in June. When data covering the period since June become available, it will be possible to make a more measured assessment.

Correction
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