Economist Sengupta asks govt to revise petro prices

New Delhi, Mar 10: Noted economist and independent Rajya Sabha member Arjun Sengupta today (Mar 10, 2006) advised the members of the Left parties to allow the Government to pass on the increase in the global oil prices to the consumers stating that the financial health of the public sector oil companies would be wrecked otherwise.

Resuming discussions on the General Budget, the former Planning Commission Member said Finance Minister P Chidambaram need not wait for the recommendations of the Rangarajan Committee for effecting revision in the prices of petroleum products.

He said at best, the government could ''calibrate'' the pass-through in the kerosene and the LPG to protect the poor class of people.

''It is a political decision which must be taken to help finances of the public sector enterprises,'' the noted economist said.

Mr Sengupta disagreed with members of the Left parties who had argued that Mr Chidambaram should not bother too much about the Fiscal Responsibility and Management Act which enjoins the government to bring in the fiscal discipline.

He complimented the Finance Minister for reining in fiscal deficit to 3.8 per cent of the GDP. Likewise, there was a need for controlling the current account deficit. ''You cannot meet the current expenditure through borrowings,'' he added.

He said a check on the fiscal deficit and Government borrowing would have a salutary impact in controlling the interest rates, which otherwise would go up.

Mr Sengupta gave full marks to the Finance Minister for a handsome increase in the savings and the investment rates. He disagreed with former Finance Minister Yashwant Sinha who had stated earlier that Mr Chidambaram did not deserve credit for improvement in savings and investment.

He said excepting the household savings, the savings in the public, corporate sector was a function of the Government economic policies. These economic policies did play a role in improvement in the savings in public and private sector. ''The improvement in private sector investment shows that their confidence in the Government is increasing,'' he said.

The well-known economist said the Government savings had turned negative at the time of the NDA Government.

Congress member Prabha Thakur supported the Budget stating it was pro-common man and the poor. She said many of the policies announced in the Budget would help the farmers and the poor.

However, BJP member Vikram Verma criticised the Government for its Budget which, he said, would not help the common man. He said the UPA Government could not claim the entire credit for the eight per cent GDP growth.

'' Most of the growth was left behind by the NDA Government,'' he said.

UNI