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Showing posts from March 28, 2013

Political-Economics of Petrol pricing in India: an Islamic Perspective #India #IslamicFinance #Petrol #Fuel #Inflation

Political-Economics of Petrol pricing in India: an Islamic PerspectiveFRIDAY, 08 MARCH 2013 07:07 SHARJEEL AND FARAZ Of the various sensitive issues that can make or break a government in India, petrol pricing is one. As on 10 Dec '12, petrol price in India is R72.3 (Average price of Metros). If we take Delhi as a base, it has fluctuated 30 times over the past 4 years causing an increase by 47%.1 On May 23, 2012 petrol saw its steepest hike ever- by R7.54 leading to nationwide protests by the opposition and the general public. Protesters in the states of Andhra Pradesh, Bihar, Odisha, Jammu and Kerala burnt effigies of Prime Minister Manmohan Singh, set motorcycles on fire and held placards reading "Bring down petrol prices".2Impact on InflationPetrol prices account for 1.09% of overall WPI (Wholesale Price Index). Implying that an 11.5% increase (due to the hike of R7.54 recently) increases the inflation by 13-15 bps.3Inflation, as we know, reduces the purchasing power o…