Understanding the Price Increases in Indian Railways, Food Grains, and LPG Subsidies

The recent price hikes in railways, food grains, and LPG subsidies have sparked debates among citizens and observers alike. This article aims to dissect the underlying reasons for these increases and examine how the Narendra Modi government is justifying these changes.

Justifying the Price Increase in Railways

One might wonder why there should be a discussion on increasing railway fares when the Indian Railways have been a critical lifeline for the country. Letrsquo;s look at the reasons behind the fare hikes and understand why the government believes it is necessary.

Justification:

No Increase in 2015: There was no increase in train fares in the railway budget of 2015. Despite this, citizens often report that they would welcome improvements such as WiFi-enabled stations, cleaner public toilets, coaches with TVs, and more metropolitan and bullet trains if prices were to increase slightly. Economic Pressures: Over the past 8-9 years, every commodity and service have seen an increase in cost. Therefore, a small increment in railway fares could be justified, especially if it were to be phased in over time rather than a sudden jump. Pending Projects: The Indian Railways have numerous pending projects that require completion. These projects necessitate considerable funds for construction and execution, which the current fares might not cover. Compensation and Legal Liabilities: In cases of accidents or other mishaps, the railways bear significant financial liabilities. These compensations also put additional pressure on the finances and necessitate a fare hike.

A Closer Look at the Price Hikes in Pulses

Pulses, a staple in Indian diets, have faced significant price increases. Here are the factors contributing to this rise:

Supply-Driven: Pulses are completely supply-driven commodities. The 2015 year was an El Nino year, leading to extreme weather conditions. This resulted in droughts, reducing the overall production of pulses and thereby increasing their prices. Drought Impact: Drought is one of the primary factors leading to decreased production in pulse crops. In a country as monsoon-dependent as India, a lack of rain can severely affect agricultural yields. Artificial Scarcity: The hike in pulse prices can also be attributed to artificial scarcity created by profit-seeking suppliers. However, the government has taken steps to address this issue through raids and raids, recovering almost 90,000 tonnes of pulses.

The Removal of LPG Subsidy

Letrsquo;s shift our focus to the LPG subsidy scheme, another significant area of contention. The governmentrsquo;s rationale for revising its policy on LPG subsidies is interesting:

Targeting the Right Beneficiaries: Subsidies were originally intended for the underprivileged and poor households. However, the government acknowledges that some beneficiaries were not genuine and were using traditional cooking methods. This created an inequitable and inefficient use of resources. Revenue Management: Removing the subsidy for those earning above Rs. 10 lakh a year allows the government to redirect the funds to those who genuinely need the assistance. This is where the PAHAL scheme comes in, which allows financially well-off individuals to voluntarily give up their subsidies to help those who cannot afford clean fuel alternatives. Environmental Sustainability: By ensuring that subsidies are channeled to those who genuinely need them, the government is also contributing to environmental sustainability. This approach helps reduce indoor and outdoor pollution caused by traditional cooking methods like firewood and cow dung cakes.

In conclusion, while each of these price hikes and policy changes may seem contentious, they are rooted in attempts to make the system more efficient, equitable, and sustainable. The Narendra Modi government has a lot to justify, but these steps are aimed at creating long-term benefits for the nation.