Spare us from the crushing blow of price hikes

It is worrying to know that the government is considering raising the prices of electricity, gas and fertilisers by March, in a bid to offset the pressure of subsidies in these sectors. If it decides to go ahead with the move, not only will it increase production costs and affect the consumers of these products, but eventually it will have a knock-on effect on the prices of daily essentials, raising the overall cost of living. Ordinary citizens, especially the poor and low-paid, are already under tremendous pressure. Inflation hit 6.05 percent in December—the highest in 14 months—overshooting the government's target of 5.30 percent for this fiscal year. Food inflation was the highest in six months, while non-food inflation came close to 7.05 percent. 

According to a report by this daily, the prices of electricity and gas could see a rise by February, while fertiliser prices may go up by March. The bid comes two months into the kerosene and diesel price hikes, the effects of which we have already witnessed. A section of officials in favour of another round of hikes believes that a "price adjustment" in the face of spiralling prices in the international market is necessary to bring the government's subsidy burden down to a "tolerable limit." They think it will help ensure funds for urgent health emergencies, like procuring additional Covid-19 vaccines and booster shots, increasing rice procurement to save farmers from incurring losses, continuing development activities, and so on.

All good points, but why wring extra money out of the public purse? It is not only politically injudicious in the last year of this government's tenure, but also an unnecessary burden the public could do without. We understand that different ministries have already sent in requests for additional subsidies to absorb the spiralling international prices. The finance ministry is reportedly reviewing the proposals and will come up with a revised budget by March. The authorities may try to lessen the subsidy burden by increasing the prices of electricity, gas and fertilisers, but we think they need to take a step back and find a way to recuperate from the losses without pushing people under the train. 

Since Covid-19 is likely to continue interrupting supply chains and shooting up international prices for some more time, high inflation may continue to be a reality. But instead of sticking to raising prices, the government should think of cutting costs in other ways—like saving money lost in systemic failures, corruption and inefficiencies, establishing greater accountability, discarding or putting on hold money guzzlers like inessential development projects, etc. 

Whatever the government decides to do, the solution does not lie in putting the burden on the public. The pandemic has already caused immeasurable sufferings and hardship to people, pushing a vast number of them beyond the poverty line. Unemployment has reached an alarming level. People are already struggling with the rising healthcare costs. Another round of price hike is the last thing they need.