The sharp hike in fuel prices over the past few weeks is taking a toll on the economy of Jammu region already sickened with the impact of COVID19 and intermittent lockdowns since last year.
As on Tuesday, the petrol price reached Rs 96.96 per Liter in Jammu district particularly, whereas the diesel price was Rs 88.81 per Liter. That is, petrol price saw an increase of Rs 0.26 from Monday and diesel saw an increase of Rs 0.25.
Notwithstanding that the industries and commerce in Jammu region are largely dependent on logistics and transportation of raw materials and finished goods from one place to another, such a trend of fluctuating and rising fuel prices has brought in new worries for industrialists, traders and consumers, all of them already grappling with the pandemic for the last more than fifteen months.
Annil Suri, Former Chairman, Federation of Industries Jammu, Former President, Bari Brahmana Industries Association, says, “Across the sectors, fuel price hike leads to a raise in logistics cost of raw materials as well as finished goods, ultimately pinching the pockets of consumers.”
Divulging the impact on local manufacturing and processing industries, Lalit Mahajan, Chairman, Federation of Industries, Jammu, President, Bari Brahmana Industrial Association says, “Our fellow industrialists have brought to the fore that the costs of some raw materials have gone up by 40% or beyond, with an increase in the costs of transportation and freight. To give you an example, the BOPP film used in production of packaging tapes costed Rs 120/kg in December 2020, reached Rs 171/kg few days ago and now stands at Rs 150/kg. Then, the acrylic polymer was being procured at Rs 56/kg in August 2020, and now at Rs 85/kg.”
Moreover, Annil Suri shares that the overall production cost has increased these days owing to increased usage of Diesel Generator sets at industries as they face frequent and unscheduled power cuts.
“While there is a jump in production costs, the demand is subdued due to pandemic – related restrictions and cascading effect on people’s pockets,” he says.
Adding to the woes of industries is presumed decline in supply of raw material to the local industries from outside J&K, viz a viz a decline in production.
Lalit Mahajan points out, “As observed by the weighbridge data in SIDCO Bari Brahmana, industrial units have received about 25-30% less raw material during the second wave of COVID19 due to various factors. Same situation may have been observed by other industrial areas, implying an overall reduced production in the region.”
Further, Deepak Gupta, President, Traders Federation Ware House-Nehru Market says, “The escalated prices of fuel are passing down to consumers as raised cost of finished goods – more so for essential goods. A common man will now have to spend nearly 10-15% extra.”
Gaurav Gupta, General Secretary, Chamber of Commerce Jammu, expressed his anguish over the unmoving kind of attitude of the entities responsible for steep rise in fuel prices.
He says, “It seems that the government has become despotic and is not at all bothered about the misery faced by people due to deaths, despair and destruction caused by COVID19, unemployment and flattening of business graph with no scope of revival in near future. The benumbed helmsmen are showing to the country that there is no one in the power corridors who can give some respite to the people suffering from sky-rocketing inflation.”
Dipanker Sen Gupta, Professor of Economics, University of Jammu, opines, “Tourism is the mainstay of economy in Jammu region, which has already shrunk due to the pandemic. So, this particular industry is not feeling the adversities of fuel price hike. However, other industries and trades are definitely hit. Operating and staying afloat in such times is tough.”
He adds, “High crude oil prices not only squeeze the profits, but cause inconvenience to a lot of people. The current hike coupled with pandemic repercussions has increased the misery manifold. However, in Jammu, the impact on the cycle of economy is overstated.”
Deepak Gupta demands that the fuel be brought under GST purview, to reduce multiple layers of tax on it.
Also: Read my article at The News Now
Fuel price hike hits Jammu’s economy already sickened with pandemic
Published in The News Now on 24th June, 2021
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