The reduction in the petrol price is the second successive cut in the fortnightly review, but one of the factors behind the decline has witnessed a dip, while the government has no control over the second, making it possible, even likely, that the inflation genie will remain out of the bottle. That the petrol price has been cut is welcome news, for it means that prices will not rise, and may even come down. Certainly, it should mean some relief on electricity charges, with a decline in the fuel adjustment charge already being mooted. The reasons for the decline however themselves reveal why this downward movement may not be lasting.
One is the decline in value of the dollar. That has been brought about through administrative means, and there is a possibility that the long bull run of the rupee may be near its end, with the month-long trend of a decline in the rupee ending on Tuesday. The second factor is the decline in international oil prices. However, that is beyond the control of any administrative measures. That too may not go any further, with prices already rising in response to the Israeli blitz of Gaza. The caretaker government may be basking in the glory reflected by some narrow benchmarks, like the rupee parity and the pump petrol price, but the fact remains that there have been none of the fundamental changes needed to set the economy on a sound footing.
Perhaps that is as well. Such fundamental changes, necessary for lasting changes, rather than the headline-grabbing changes wrought so far, can only be made by a government duly invested in them, able to carry along public opinion. That is only possible if the government has been elected. The caretaker government seems to have forgotten that its task was to hold free, fair and transparent elections to produce such a government, rather than making fundamental reforms itself. Its members must resist the temptation to attempt to solve perennial problems, and keep themselves in readiness to face such genuine emergencies as natural disasters or enemy attacks. It must realize that it is not vying in any popularity contest, and has no need to convince anyone of its abilities. That is best left to politicians who contest elections.
