Public sector companies such as HPCL and BPCL hiked MTO prices by Rs 4 per litre last week.
The public sector marketers have raised MTO prices by 86 per cent in the last one year.
In 2004, MTO prices went up by more than 40 per cent. It further increased by over 50 per cent and 40 per cent in 2005 and 2006, respectively. The rates went up by 76 per cent in the year 2007.
Between March 20 and May 6 in the current year, prices soared over 37 per cent.
Additional VAT has worsened the situation in Gujarat. There are over 200 small- and medium-scale paints units in the state.
"High prices have squeezed our margins and we are struggling to survive. While it may not be difficult for the organised sector to absorb this price hike due to economies of scale, big turnover and higher margin products, it will be impossible for the small- and medium-scale paint makers to survive," said Madhukar Shah, former president of Indian Small Scale Paint Association.
"We have been trying to contact Petroleum Minister Murli Deora to make a presentation on behalf of the industry for the last two months, but we have not managed to meet him till date. Now, we have to spend Rs 45,800 per kilo litre, which was Rs 41,800 last week. As we are unorganised players, we could not pass the burden to our dealers or consumers," said Shah.