Fuel price cut brings cheer

The common man has received the government's move of slashing fuel prices with smiles even as political parties vie to take credit for the price reduction. People feel that the price cut will reduce the burden on them apart from curbing the rising inflation rate.
u00a0u00a0 The union government on Wednesday cut the prices of petrol and diesel by Rs 5 and Rs 2 per litre respectively. The price of LPG was also reduced by Rs. 25 per cylinder.
u00a0u00a0u00a0 The decision to undertake a second cut in fuel prices in less than two months was taken at a cabinet committee meeting headed by external affairs minister Pranab Mukherjee.
u00a0 Ram Kashyap, a software engineer working with a leading software company, says, "The fuel cut is definitely a relief to the consumers. This is a good move considering the economic drought, but one can't stop relating it to the upcoming parliamentary polls."
u00a0 Another techie, Sreesha Kudoor, too attributes the reduction in fuel prices to the forthcoming elections. "Fuel price reductions are most welcome and more so in the current economic situation. What should have happened a couple of months back has finally been enforced. Thanks to the forthcoming elections without which we would have been deprived of this as well," he says.
u00a0u00a0 Transporters, however, are unlikely to be satisfied with the cuts announced, as they had gone on an eight-day nationwide strike demanding that the government cut at least a Rs.10 per litre cut in diesel prices.
u00a0u00a0 Economists and experts opine that fuel-price cuts add to the impact of weaker export markets and dropping commodity prices. Even if prices decline from year-earlier levels for a time, this won't signal the start of a self-sustaining spiral that drags down wages and demand, they say. Rather, India's technical deflation will reflect the year-on-year statistical comparison with earlier high inflation and will eventually be countered by the country's loose fiscal and monetary policy, according to them.u00a0u00a0