India's left groups to push Singh for oil price cut

12 Nov, 2004

India's communists, who lend crucial support to the ruling coalition, said they would press the government to roll back increases in gas and diesel prices at a meeting with Prime Minister Manmohan Singh on Thursday. "The government cannot stick to the hikes (in fuel prices) as they are," senior Communist Party of India leader D. Raja told Reuters ahead of a meeting between the communists and leaders of the ruling United Progressive Alliance (UPA) including Singh.
"The government will have to make some concession (over the increases in fuel prices) to the people."
Though analysts say the communists are unlikely to withdraw support to the government, their opposition to the fuel price increases and a host of economic reforms will force Singh to move cautiously on issues like foreign direct investment and energy prices in the future.
Earlier this month, the Congress party-led UPA alliance raised prices of petrol by nearly six percent and diesel nearly nine percent to meet a surge in global crude prices.
The government also increased prices of cooking gas by 20 rupees and five rupees a month later.
This sparked sharp protests from the opposition as well as the communists, who won a record 60 parliament seats in national elections in May and provide outside support to the government.
India's communist parties, who will meet together ahead of the meeting with Singh, said they were keen for the ruling alliance to cut back increases in the price of cooking gas - used by millions - and diesel.
They say diesel, which accounts for 40 percent of all refined products sold in India, is widely used in the transport sector and the increase in its price would push up inflation, already high at 7.38 percent.

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