In June 2020, PLA troops “surprised” India in the Ladakh sector of the contested LoAC (line of actual control) where the Indian Army lost 20 lives, including that of Colonel Santosh Babu in the Galwan valley.
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In a welcome move, Defence Minister Rajnath Singh on June 12 approved a revised policy on how India compiles, archives and disseminates its war documents and related history. As per the new policy, once an operation/war is completed, the first cut of history is to be prepared and disseminated for internal circulation within five years. Whether this first draft of history is to be placed in the public domain or not, will be determined on a case by case basis, depending on the sensitivity of the operation/war. Predictably, the Henderson Brooks-Bhagat report relating to the 1962 war with China, which is still under wraps, will not be part of the new policy. Apparently, another committee will take a view on previous wars.
Unveiling this new policy on the eve of the first anniversary of the Galwan “scuffle” on June 15 has complex symbolism about India’s strategic culture and the opacity cum ostrich-act that envelops its China policy in particular. From all accounts, with Prime Minister at the helm, India’s bilateral relationship with China seemed more than buoyant and the image-rich Modi-Xi summitry that moved from Ahmedabad to Wuhan to Mamallapuram conveyed a sense of shared bonhomie. However, this optimism was clearly misplaced and the tea leaves were not read astutely.
In June 2020, PLA troops “surprised” India in the Ladakh sector of the contested LoAC where the Indian Army lost 20 lives, including that of Colonel Santosh Babu in the Galwan valley. The PLA also lost their troops, though the official number admitted is only four personnel.
Galwan is a major punctuation in the troubled bilateral relationship and India has come off second best in the Ladakh “scuffle”. Delhi has to contend with an altered LoAC and a Beijing that has decided to violate the 1993 Jiang Zemin-Narasimha Rao agreement. Carefully shaped narratives about the military defending national sovereignty and territorial integrity are crucial for any political leadership — authoritarian or democratic — and Galwan has special salience for both China and India.
While India has interpreted Galwan as a case of Chinese perfidy and places the onus on Beijing to restore the status quo, the view from China is very different. In the run up to the July 1 centenary of the CCP (Chinese Communist Party), the PLA action against India is being projected as a case of guarding the border and defending the motherland.
A Chinese flag “once raised on Pangong Lake” is being taken by elite PLA troops from units posted along the LoAC to educational institutions to stoke pride in military and muscular nationalism, wherein the military reiterates its allegiance to the party as represented by President Xi Jinping. The CCP in turn has accorded unto itself the sacred duty of defending the territoriality of the motherland and Galwan is being accordingly consecrated.
India’s narrative about Galwan remains opaque and there has been no detailed official statement from the Ministry of Defence on the current tactical situation in Ladakh. PM Modi’s statement soon after the Galwan incident (June 20, 2020) that, “No one entered Indian territory nor were Indian posts taken” has set the obfuscation template about transgressions by the PLA.
Recently in May this year, the Army Chief General M M Naravane noted in an interview: “There has been no transgression of any kind and the process of talks is continuing.” If indeed there has been no “transgression” then what is the meaning of insisting on a return to the pre-Galwan status quo?
From a policy perspective and in keeping with the latest directive about military operations and narratives, the Galwan anniversary should encourage the government to set up an independent panel of experts to review the institutional lapses that led to an altered LoAC in the Ladakh sector.
Concurrently, Delhi will need to objectively review and anticipate what the PLA may embark upon next. Beijing has staked an expansive territorial claim that includes Arunachal Pradesh and the completion of the Lhasa-Nyingchi high-speed railway network by end June has multiple tactical and strategic implications. This railway line would terminate at a point that is less than 15 kilometres from the LoAC north of the Tuting sector in Arunachal Pradesh.
Galwan could have a silver lining if it encourages Delhi to review its China narrative in an objective and unvarnished manner and craft affordable and effective long-term strategic/security policies that are not clouded by political compulsions.
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Petrol in India is cheaper than in countries like Hong Kong, Germany and the UK but costlier than in China, Brazil, Japan, the US, Russia, Pakistan and Sri Lanka, a Bank of Baroda Economics Research report showed.
Rising fuel prices in India have led to considerable debate on which government, state or central, should be lowering their taxes to keep prices under control.
The rise in fuel prices is mainly due to the global price of crude oil (raw material for making petrol and diesel) going up. Further, a stronger dollar has added to the cost of crude oil.
Amongst comparable countries (per capita wise), prices in India are higher than those in Vietnam, Kenya, Ukraine, Bangladesh, Nepal, Pakistan, Sri Lanka, and Venezuela. Countries that are major oil producers have much lower prices.
In the report, the Philippines has a comparable petrol price but has a per capita income higher than India by over 50 per cent.
Countries which have a lower per capita income like Kenya, Bangladesh, Nepal, Pakistan, and Venezuela have much lower prices of petrol and hence are impacted less than India.
“Therefore there is still a strong case for the government to consider lowering the taxes on fuel to protect the interest of the people,” the report argued.
India is the world’s third-biggest oil consuming and importing nation. It imports 85 per cent of its oil needs and so prices retail fuel at import parity rates.
With the global surge in energy prices, the cost of producing petrol, diesel and other petroleum products also went up for oil companies in India.
They raised petrol and diesel prices by Rs 10 a litre in just over a fortnight beginning March 22 but hit a pause button soon after as the move faced criticism and the opposition parties asked the government to cut taxes instead.
India imports most of its oil from a group of countries called the ‘OPEC +’ (i.e, Iran, Iraq, Saudi Arabia, Venezuela, Kuwait, United Arab Emirates, Russia, etc), which produces 40% of the world’s crude oil.
As they have the power to dictate fuel supply and prices, their decision of limiting the global supply reduces supply in India, thus raising prices
The government charges about 167% tax (excise) on petrol and 129% on diesel as compared to US (20%), UK (62%), Italy and Germany (65%).
The abominable excise duty is 2/3rd of the cost, and the base price, dealer commission and freight form the rest.
Here is an approximate break-up (in Rs):
a)Base Price | 39 |
b)Freight | 0.34 |
c) Price Charged to Dealers = (a+b) | 39.34 |
d) Excise Duty | 40.17 |
e) Dealer Commission | 4.68 |
f) VAT | 25.35 |
g) Retail Selling Price | 109.54 |
Looked closely, much of the cost of petrol and diesel is due to higher tax rate by govt, specifically excise duty.
So the question is why government is not reducing the prices ?
India, being a developing country, it does require gigantic amount of funding for its infrastructure projects as well as welfare schemes.
However, we as a society is yet to be tax-compliant. Many people evade the direct tax and that’s the reason why govt’s hands are tied. Govt. needs the money to fund various programs and at the same time it is not generating enough revenue from direct taxes.
That’s the reason why, govt is bumping up its revenue through higher indirect taxes such as GST or excise duty as in the case of petrol and diesel.
Direct taxes are progressive as it taxes according to an individuals’ income however indirect tax such as excise duty or GST are regressive in the sense that the poorest of the poor and richest of the rich have to pay the same amount.
Does not matter, if you are an auto-driver or owner of a Mercedes, end of the day both pay the same price for petrol/diesel-that’s why it is regressive in nature.
But unlike direct tax where tax evasion is rampant, indirect tax can not be evaded due to their very nature and as long as huge no of Indians keep evading direct taxes, indirect tax such as excise duty will be difficult for the govt to reduce, because it may reduce the revenue and hamper may programs of the govt.