Few cabs and little fuel: Twin strikes hit transport services, commuters

Commuters in Delhi on Monday found themselves at the receiving end of a political double whammy: CNG, petrol and diesel were in short supply as private petrol pumps went on strike; and no cabs were in sight except at extortionate tariffs as cab drivers too struck work.

400-odd petrol pumps and CNG-dispensing units in Delhi remained closed on Monday as a protest against the Delhi government’s resistance to lowering the value-added tax (VAT), thus keeping the retail prices of the fuels higher than in the neighbouring states; and cab drivers went on strike against the Delhi government’s policies that “went against the interests of both three-wheelers and cab drivers”.

Delhi Chief Minister Arvind Kejriwal accused the Union government, led by the Bharatiya Janata Party (BJP), of instigating both strikes, although 20 government-owned petrol and CNG outlets were open.

“BJP people have threatened petrol pump owners with income-tax raids if they did not go on strike. The oil companies also stated that tough action will be taken against petrol pumps not on strike,” he tweeted. Interestingly, the strike was also observed in Odisha, the home state of Petroleum and Natural Gas Minister Dharmendra Pradhan.

Kejriwal said oil prices were the "lowest" in Delhi among the four metro cities, adding petrol pumps were not on strike in Mumbai despite the oil prices being the “highest” there “because the BJP was ruling in Maharashtra”.

Simultaneously, drivers of Ola and Uber went off the roads though they were offering “private” service at costs considerably higher than the tariffs charged by the taxi aggregators. The surge in the price of rides was almost 100 per cent in many areas. Some of the riders even complained drivers overrode the app, charging a premium.

According to sources close to Ola and Uber, both the cab aggregators saw almost 50 per cent of their cabs not logging in for work. They said the number of cabs in Delhi was down to 80,000-100,000. According to industry sources, on any given time of the day the number of cabs in Delhi from both Uber and Ola is 250,000 to 300,000.

“We regret the disruption caused to our riders and the driver-partner community due to a small group of individuals. We remain committed to serving the city and ensuring that our driver partners continue to access a stable income while giving riders a convenient, reliable option to get around Delhi,” an Uber spokesperson said.

Mumbai also saw sporadic incidents of driver union members trying to stop cabbies from plying.

For the record, Inderjeet Singh, chairman of the All India Tour and Transport Association and convener of the joint forum, the Sanyukt Sangharsh Samiti, said: "We will hand over a memorandum to the Prime Minister’s Office as the (Delhi) government has failed to listen to our grievances. Auto-rickshaw and taxi drivers are losing employment due to wrong transport polices of the (Delhi) government and also due to low fares offered to commuters by cab aggregators," he said. 

At the heart of the petrol pump strike in both Delhi and Odisha was the value-added tax (VAT). A few months ago, responding to an appeal from Finance Minister Arun Jaitley, most BJP-run state government lowered the VAT, leading to a Rs 2.50 decrease in petrol and diesel prices per litre. 

These included Haryana, Uttar Pradesh and Chhattisgarh. West Bengal and Andhra Pradesh also lowered prices. But the Delhi government refused to cut the tax, causing a reversal of a historic trend: for the first time fuel prices in Delhi went up in relation to neighbouring states, driving consumers to buy fuel from these two states. 

“During the 15 years of the Congress government, the VAT on diesel and petrol was kept at 12.5 per cent and 20 per cent respectively, which was increased to 16.75 per cent and 27 per cent on July 1, 2015 by the Kejriwal government. With prices increasing now, the Delhi government should cut VAT too as we are losing our consumers to neighbouring states,” said Nischal Singhania, president, Delhi Petrol Dealers Association (DPDA).

He added that due to difference in prices there has been a sharp drop of 50 per cent to 60 per cent in sale of diesel in Delhi and 25 per cent in petrol in this quarter. 

The BJP tried to cash in on public ire. “Government has already decreased the price of Petrol-Diesel by Rs 2.5 per litre for giving relief to the common man but the Kejriwal Government is not concerned about the people of Delhi and is disregarding the interest of common man” said a statement issued by the Delhi unit of the BJP.

In Odisha, it was the same story. Private dealers said they could lose as much 50 per cent of their highway business to neighbouring states, especially diesel. In the past, diesel prices stayed lower than petrol, because of lower taxes, dealer commissions and base price. 

However, the increase in the base price of diesel has absorbed the lower excise rates over the last two years, making Odisha the first state in the country where diesel is costlier than petrol, currently around 13 paise more than petrol. 

“Due to lower VAT rates on diesel compared to the levy on petrol in the neighboring states, rates of diesel in Odisha is dearer by between Rs 1 and Rs 3. In Odisha, VAT rates are uniform (26 per cent) for both diesel and petrol. About 50 per cent of highway business of petrol pump dealers has shifted to other states. We have started the exercise on collating data for the exact loss”, said Utkal Petroleum Dealers Association General Secretary Sanjay Lath. 

Inevitably the Centre and the state (ruled by the Opposition Biju Janata Dal) traded charges.

  

Odisha's finance minister, Sashi Bhushan Behera, sought a clarification from the Centre why it was charging Rs 5 more as the base price for diesel compared to petrol.

Countering the allegations, Bharatiya Janata Party (BJP) asked the Odisha government to introspect on why prices of diesel are lower in the neighbouring states like Chhattishgarh, West Bengal and Andhra Pradesh. The BJP also alleged that the state government is pocketing a whopping Rs 22.50 as tax on each litre of petrol and a similar amount on diesel.