The government is undoubtedly taking several steps to combat the price of petrol at the pump as well as to shore up the value of the Rupee versus the Dollar. I have written several times about how the Direct cost of petrol (from a rising Crude price) impacts the indirect cost of commodities such as Rice, Wheat, Onion etc. The impact from a rise on Petrol of 1 rupee can be as much as 4 rupees on the commodities. Prices of Onion, Rice, Wheat will all rise just around the December elections for various states and the coalition in power at the Centre will be blamed. Here are three suggestions for the importers of crude and producers of petroleum that will help keep the price rise to as low as possible. This is your chance to make a contribution to the Bharat Varsha.
Impress upon the Government to talk to their United States (US) counterparts to allow this. It takes two to tango and India is dancing with the US now…
- Stop buying spot prices – that too at a premium. If true, this suggests that you are maybe over-invoicing your imports, by routing purchases through various shell corporations. Be transparent, declare your purchase price (this should be the same as what France and the United Kingdom pay), from crude producers like Saudi Arabia and Nigeria. The interactive graphic below shows the spot prices for the first few months of 2018…
- Buy from Iran, which is willing to give an 18-20% discount on the spot prices and who is also willing to accept the rupee as part payment. Impress upon the Government to talk to their United States (US) counterparts to allow this. It takes two to tango and India is dancing with the US now…
- Do not under-invoice your refined petroleum/ diesel exports. This has long been alleged and with increasing data analytics at the disposal of the investigative agencies, you will be caught. How about for once, taking a hit for the cause of the country?
Trust me when I say this – there is more joy in giving than getting. Are you listening?
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