A devil called diesel
Diesel is under-prised by Rs 5. The government claims that it is used by farmers for their tubewells and tractors. But a major share of diesel is used by trucks and other heavy commercial vehicles. A cabinet decision was taken in November 1997 to deregulate diesel prices. But for the last one year, this has not happened, even as world diesel prices have gone up by 30 per cent.
To offset some of the losses due to these subsidies, the government has continued to overprice petrol. In the Union budget for 1998-99, the government increased the price of petrol without any increase in prices of diesel. Petrol, on the other hand, is over-priced and the price difference between petrol and diesel is around Rs 16 per litre. As a result, most of the major car manufacturers have come out with diesel models. Today the rich, including owners of the Mercedes Benz, run their cars on subsidised diesel. The Tata Indica, has sold over 80,000 diesel cars in Delhi itself.
India does not have any policy of emission taxes or of including the environmental and health costs in the cost of fossil fuels. There is enough scientific evidence on the carcinogenic effect of toxic particulate emissions from diesel. Diesel engines emit 100 times more particulate matter than gasoline engines. While a World Bank study stated that about 40,000 deaths in 36 Indian cities due to air pollution in 1991-92, a subsequent calculation done by the Centre for Science and Environment (>cse), a Delhi-based non-governmental organisation, shows that the death count increased by almost 30 per cent by 1995.