The Communist party said that Dr Singh"s justification of hike in petrol prices reflects a 'flawed economic thinking'.
PM's estimated 0.4 per cent rise in the wholesale price index is a 'gross miscalculation' as it does not consider the impact of high fuel prices on food prices, the statement, released on Wednesday, Mar 3, contended.
“Food price inflation soared after the last hike in petrol prices in July 2009. At a time when the people are reeling under nearly 20 per cent food price inflation, this round of fuel price hike will amount to a completely back-breaking burden," the party said.
Besides this, noting that revenue worth Rs 26,000 crore will be lost during the same period due to the cut in income taxes, the party questioned, “How come the Prime Minister is defending the indirect tax hike in the name of fiscal consolidation while turning a blind eye towards the direct tax cuts?"