LPG cap raise: Govt did not bow down to Rahul, says Cong

The Union Cabinet on Thursday approved an increase in the number of subsidised domestic LPG cylinders that a household can get in a year from nine to 12. This, after Congress Vice President Rahul Gandhi had on 17 January requested Prime Minister Manmohan Singh to increase the subsidy saying nine cylinders were not sufficient for a household.

Meanwhile, RBI governor Raghuram Rajan criticised the move saying, "We have to be very careful because we need to spend on very important things we are currently not spending on. I believe there is a certain amount of population that can benefit from subsidised LPG cylinders. But beyond a certain point you are reaching people who can well afford to pay for it… Whose pocket is it coming from? It's coming from the pockets of people who are getting subsidised LPG."

Representational image. Reuters

So is this decision, in a election year, just to get votes?

Congress spokesperson Salman Anees Soz defended the government decision during a debate in CNN-IBN saying, "The people of the country run this govt. The whole notion that the government has bowed down in front of Rahul is misplaced. It is the responsibility of the party to raise issues before the government, and then the government makes decisions on what they can or cannot do. If something helps the poor people of the country then we should do it. Our process of consultation on LPG has been going for ages. When we do something that the poor of the country needs, everyone is up in arms."

Refuting Soz's argument, economist Prasenjit Bose said, "You should also accept that your government's policies is anti-poor. Why did it take Rahul Gandhi take such a long time, just before the elections? From my point of view what I am against is the way this decision has been taken on the whims of the 'Yuvraj' of this party. This is populist and cheap."

Meanwhile BJP leader KJ Alphonse was of the opinion that it was better to make people stand on their feet than give them freebies. "Our policy is simple, it is better to teach a man fishing than giving him fish. We are not against subsidies," he said and added, "This government increased the price of natural gas, who does it benefit? Then they say sorry for increasing the prices and then says I will give you subsidies?"

Also, AAP Praveen Singh questioned why the government does not make up for the money that it will cost for this subsidy by re imposing wealth tax and the likes.

"For every Rs 100 of revenue gets the goverment, the revenue forgone is Rs 60. Corporates get away with subsidies," he said.

But was the Congress decision nothing but bad politics?

Author and economist Shankkar Aiyer says, "The Congress has calculated the price of middle class votes as three cylinders and they have got their economics and politics wrong. The question is what is merit subsidy and what is non-merit subsidy and this is clearly non-merit subsidy. Political parties think money doesn't grow on trees but votes grow on trees."

Aiyer also added, "They think the voter is the useful idiot. Because last year the PM was right today the Congress is right. The only step this goverment took on subsidies was Aadhaar and now it has been buried under the ground."