Petrol price hike: What's the fuss about?

The nation howls in protest as the oil companies raise the price of petrol by Rs 6.28 per litre. Once VAT/ sales tax and other taxes are added, the price to the consumer could go up, on an average, by Rs 7.50 per litre depending on where you live in India.

Let us take a moment and look at the impact that the rise will have on the car-owner’s pocket. First, eliminate all those cars which are either diesel or natural gas driven - these are not affected by the rise.

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For the petrol cars, taking an average of 100 km per day of driving, and taking an average fuel efficiency of 15 kmpl, the increase comes to Rs 1,498 per month (6.66 litres X Rs.7.50 X 30 days).

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That’s it. Rs 50 per day - if you drive 100 km per day and if you drive this distance every day of the month. The majority of car-owners will not be driving 3,000 km per month, so the majority will get impacted considerably less than Rs 50 per day on the average. Of course, those with less efficient cars will end up spending more - but the majority of cars on Indian roads deliver at least 15 kmph.

For the two-wheelers, taking an average fuel-efficiency of 50 kmpl (and most two wheelers do deliver more), and taking the same distance of 100 km per day travelled, the impact is Rs 450 per month (2 litres X Rs. 7.50 X 30 days).

That’s Rs 15 per day - if you ride 100 km per day and do so every day of the month.

That’s what this hue and cry is about - Rs 50 per day for the majority of car owners and Rs. 15 per day for the majority of two-wheeler owners.

We’re not suggesting that these sums do not hurt - but the pain is less than the headlines make it out to be.