Step to manage inflation
Inflation has been a cause of burden on economy of a country throughout the world. Of the main reasons, few are like - Rise in demand of Goods and services more than capacity, exchange rates variations thereby reducing value of money, increase in money supply than economic growth, increase in taxation, CRR rates etc.
The burden of inflation is a slow process on the economy by increasing cost of living (rise in prices of food, goods and services ), increase in cost of doing business ( in industry, agriculture). In fact, it grips around almost all the economic activities in the country.
At present, inflation in goods and services caused is due to increase in fuel prices in India. Frequent discussions are observed in press and media at different platforms with different groups ending up with no direction/ solution to the matter. It is understood that the reasons stated are -
i) Cost to the company,
ii) Tax by Central Govt. and
iii) Tax by State Govt.
Taken together, all these expenditure takes up the cost of fuel sold at almost double than its original cost.
In order to exercise control on the rising fuel prices to be sold at a fixed rate, it is proposed that Govt. may consider creating ' Fuel Inflation Control Fund' to start a new system to control inflation. The fund can be created by crediting @ INR 1/- only per litre of fuel sold in the country on daily basis. It is understood that 40 lakhs of fuel ( approx.) is sold daily in the country which , if calculated @ INR 1/- shall work out to substantial amount for this fund. This can be funded by the three beneficiaries mentioned above on a prorata basis or on the basis of their share of tax revenue earned. As such,the amount so works out to be @ INR 0.33 p./ litre approx. which will not be much of a burden on their budgets, as now a days, it is reported that fuel prices are coming down by @,10p. to @,60p. daily, so it may not be much of a burden to the beneficiaries.
Fund can be used to meet the differential increase in fuel prices (over and above the fixed price) as and when increase occurs. The benefits of this exercise will be -
i) Budget of each family will come down both in rural as well as urban areas.
ii) Increase in job prospects of the youth to be engaged in managing the funds on all India basis.
iii) Boost to Agriculture, business and Industry due to reduction in their cost of carrying materials to /from markets and vice versa.
iv) Prices of all goods and services will become stable and economical.
It is understood that this fund will grow to such an extent that it will be able to support other projects of the Govt. with the of passage of time and control inflation thus giving boost to the economy.
The burden of inflation is a slow process on the economy by increasing cost of living (rise in prices of food, goods and services ), increase in cost of doing business ( in industry, agriculture). In fact, it grips around almost all the economic activities in the country.
At present, inflation in goods and services caused is due to increase in fuel prices in India. Frequent discussions are observed in press and media at different platforms with different groups ending up with no direction/ solution to the matter. It is understood that the reasons stated are -
i) Cost to the company,
ii) Tax by Central Govt. and
iii) Tax by State Govt.
Taken together, all these expenditure takes up the cost of fuel sold at almost double than its original cost.
In order to exercise control on the rising fuel prices to be sold at a fixed rate, it is proposed that Govt. may consider creating ' Fuel Inflation Control Fund' to start a new system to control inflation. The fund can be created by crediting @ INR 1/- only per litre of fuel sold in the country on daily basis. It is understood that 40 lakhs of fuel ( approx.) is sold daily in the country which , if calculated @ INR 1/- shall work out to substantial amount for this fund. This can be funded by the three beneficiaries mentioned above on a prorata basis or on the basis of their share of tax revenue earned. As such,the amount so works out to be @ INR 0.33 p./ litre approx. which will not be much of a burden on their budgets, as now a days, it is reported that fuel prices are coming down by @,10p. to @,60p. daily, so it may not be much of a burden to the beneficiaries.
Fund can be used to meet the differential increase in fuel prices (over and above the fixed price) as and when increase occurs. The benefits of this exercise will be -
i) Budget of each family will come down both in rural as well as urban areas.
ii) Increase in job prospects of the youth to be engaged in managing the funds on all India basis.
iii) Boost to Agriculture, business and Industry due to reduction in their cost of carrying materials to /from markets and vice versa.
iv) Prices of all goods and services will become stable and economical.
It is understood that this fund will grow to such an extent that it will be able to support other projects of the Govt. with the of passage of time and control inflation thus giving boost to the economy.
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