Comment by rubberstamp | Hacker News Reader

Comment by rubberstamp | Hacker News Reader

Parent Full thread

Modi, the current prime minister of India got into power with big majority as the coalition govt(UPA coalition) at the was too corrupt. Modi promised big reforms, like Obama when he got first elected, but nothing positive yet for the majority of population. He is some what pro business, but not enough pro business or pro masses to worth any applause. I don't think pro business and pro masses policy is mutually exclusive. So far it looks like his election campaign was just a marketing campaign to get elected.

See gas price, crude oil price and rupee/dollar rate over last few years. *sorry about the formatting as this is html doesn't care about white spaces and <pre> tags doesn't work here

year 10 11 12 13 14 15 today

$ Crude 74 109 90 99 108 61 33

Rs.gas 51 63 71 63 71 66 64

$ vs Rs 46.2 44.7 57.1 59.2 60.2 63.4 66.8

The prices are deregulated. But still even though crude prices has fallen so much, govt keeps retail gas prices costlier by increasing taxes. Taxes form the majority of retail gas price.

Taxes vary between states, which is detrimental for business due to the amount of paperwork. Unified tax rate named GST was to be introduced(its not a law yet). The outrageous statement made by someone was that even though GST will charge uniform tax rate somewhere in the range of 14-18% gas prices will be kept out of its purview for the time being. The horror!

But things are bright for India in the long term as youth have high education. All most all have college degree. There are press or internet censorship.

I don't understand how keeping taxes on gas prices meant that he is all marketing gimmicks? Did he promise that he'll keep gas prices low? Gas is neither cheap nor costly with the current price in India[1]. It's midway compared to most of the countries and almost the same as China. India is not a oil producing country and keeping it cheap will hurt its economy. Btw INR/USD in 2010 was way stronger than today.

[1] http://www.globalpetrolprices.com/gasoline_prices/

What I hate about the guy is the increasing religious intolerance that is happening because of this party, and him doing not much about it. He gained a lot of votes by promising to fix corruption and telling "good days are coming". People are actually frustrated as "good days are not coming".

India imports majority of crude and refines all petroleum within the country. Business aren't paying international wages for their refinery workers, they get paid normal wages like for any other Indian. Yet when it comes to selling the petroleum products refined within the country, oil marketing companies used to say they were selling at loss. Not real loss, but hypothetical loss if they weren't selling at international prices -the companies were always making profit. These are listed companies and their annual reports are public.

Now Modi may have not promised he'll keep gas prices low, but is keeping it artificially high what he should do?

Keeping it cheap will not hurt economy as it has a direct impact on prices of food and transportation. People would've been able to save more.

If you pre-pend each line with four spaces, those lines act like they are <pre>.

    year    10   11   12   13   14   15   today
    $ Crude 74  109   90   99  108   61   33
    Rs.gas  51   63   71   63   71   66   64
    $ vs Rs 46.2 44.7 57.1 59.2 60.2 63.4 66.8

Keeping gas prices high isn't a bad thing. It helps India not fall into the trap of consumption increasing when prices are low and crying for subsidies when they go back up.

India used to have subsidies on retail gas prices. Now it doesn't since complete price deregulation and so whenever global crude price changes those was supposed to reflect on retail prices. As expected prices increase whenever crude price increases, but whenever crude prices decreases central govt is increasing taxes. Current govt has raised taxes on gas/diesel almost every two weeks and yet again last week.

I wrote a script to calculate what the prices should be, factoring in the exchange rate and crude price prevailing at the time and these are the results I got.

    Month/Year    [retail_price vs would_be_price(if taxes were not increased) ]

    June 2014    (Rs 71.51 vs Rs 71.51) - taxes when he got into power

    June 2015    (Rs 66.93 vs Rs 39.89)

    Jan 11, 2016 (Rs 64 vs 36.27)

Also the tax on gas prices are really complicated. Oil marketing companies refines and their selling price includes their markup. On that selling price there are a couple of central govt taxes. Now on that price(including the central govt taxes), there are couple of state taxes. Current cost of petrol/gasoline including markup of refineries is around Rs.25 Rest are taxes.

I meant no press/internet censorship

Reply on news.ycombinator.com