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Fuel price hike: UPA under pressure from allies

Sep 16, 2011 08:11 PM IST Politics Politics

New Delhi: The UPA is under pressure from key allies DMK and the Trinamool Congress who have been demanding a roll back of the petrol price hike. The government was on Friday forced to defer a meeting to decide on limiting the supply of subsidised LPG cylinders.

An unnerved government faced anger both from outside and within with the DMK and the Trinamool Congress accusing the government of not keeping them in the know on the EGoM proposal to hike LPG prices. The Pranab Mukherjee led EGoM was shelved.

The EGoM was supposed to discuss a proposal to limit subsidy on LPG cylinders to 4 to 6 cylinders per household and any cylinder over and above this would have to be purchased at market rate ranging from Rs 666 to Rs 750.

The government was hoping that with about only 20 per cent of population using more than 4 cylinders and rural India not too hooked to it, it wouldn't be a politically hard decision. But the timing was wrong, coming just a day after a over Rs 3 hike in petrol prices. Allies and Opposition demanded a rollback.

A cornered government, however, said it was helpless.

The Congress too may have been forced to defend the government decision to hike petrol rates saying prices were decontrolled, but it is aware that it has given fresh ammunition to the BJP. Sources say the Congress has once again tread the predictable path asking its chief ministers to cut taxes to offer some relief.

But these hikes have reinforced the growing perception that UPA II has been increasingly incompetent to tackle both corruption and inflation.