the emergence of serious foreign exchange crisis in 1990-91 is primarily due to oil imports . If we restrict oil imports , the industrial development centred around automobile sector will not survive and lead to profitability crisis for Monopoly capital / corporate forces . Despite serious foreign exchange crisis , the government liberalized oil imports which is really a serious contradiction . Our crude oil needs are as high as 80 % of our imports .
The distortions in our industrial structures in terms of industrial development centred around automobile sector will naturally pressurise import liberalisation policies for oil imports . Consequently our country will be entangled in the vicious circle of foreign exchange crisis . This trend will aggravate continuously .
The distortion in the form of automobile industrialisation normally leads to the development of its forward and backward linkage industries and allied industries . Consequently the distortions will get rooted firmly into our industrial structures . On the other , continuous rise in the oil imports has resulted in the continuation of foreign exchange crisis . It will be evergreen . Crisis in Automobile Sector In 2019 as many as five lakh passenger cars and 30 lakh two wheelers remained unsold in the car factories . This lead to the emergence of profitability crisis to these companies . As this sector is synonymous to our industrial sector , the crisis in the automobile sector will be an economic crisis for our country . The car companies started taking measures to reduce cars production . For example , the Japan based car company , Toyota and South Korea based company , Hyundai Motors have reduced 50 % of their plant ’ s production in 2019 . This lead to the loss of livelihood to thousands of workers . In fact , it is estimated that as many as 3.5 lakh people lost their livelihood in automobile spare part industry . Thus , the crisis in automobile sector aggravated the problem of unemployment . 8
The studies of SBI and RBI clearly revealed that the wages are on the decline continuously and growing inflation lead to negative real wages . An ILO study states that the wage in India is less than the labour ’ s productivity . In these conditions , the crisis in automobile sector further weakened the conditions of workforce . Will the government which has already disconnected from the welfare of the people considers the miserable conditions of working class ? Further , the government takes decisions only from the view point of ensuring profits to corporate forces , therefore , it has raised the minimum wage from Rs . 176 to Rs . 178 i . e . an increase of just two rupees !
Astonishingly , in 2019 , vehicles including passenger cars , commercial vehicles , two wheelers , three wheelers and quadri cycles were produced to the tune of 26 million . Government Measures to Raise the Sales of Automobile Products
The pro-corporate government could not tolerate the profitability crisis of monopoly capital . In 2019-20 , the corporate tax is reduced making it the world ’ s minimum . Further the announcement of vehicle scrap policy in 2020-21 , Central Budget states that the government and commercial vehicles which completed 15 years , private and personal vehicles which completed 20 years must be scrapped . It is only 10 years for diesel vehicles . Moreover , registration cess is decreased for new cars . All these measures are only to increase the sales of cars . The government has announced its aim of attracting Rs . 42,500 crores of new investment and achieving additional production to the extent of Rs . 2.3 lakh crores through production linked incentive scheme . In addition , 100 % Foreign Direct Investment is permitted through automatic route in this sector .
In October 2020 , the Japan Bank for International Cooperation ( JBIC ) agreed to provide US $ 1 billion ( Rs . 7400 crores ) to SBI for funding the manufacturers and sales business of suppliers and dealers of Japanese automobile manufacturers and providing auto loans for the purchase of Japanese automobiles in India .
The government which took serious measures to raise the production and sales of automobile sector failed to take any measures to improve the livelihood prospects of workforce . Prices of Petrol , Diesel and Gas
The prices of petrol , diesel and gas are on the rise continuously for the past seven years irrespective of the fall in the Global Oil prices . The price of petrol increased 56 times and diesel by 57 times between April 2020 and December 2020 . The combined taxes and cess of Central and State governments constitute 62 % in the price of a litre of petrol and 57.5 % for diesel . The petrol price at present reached Rs . 110 per litre and the gap between petrol and diesel price is narrowed .
In fact , these taxes became the primary revenue sources for Central and State governments . The Central government ’ s tax revenue from this source has increased to Rs . 3,34,314.83 crore in 2019-20 from Rs . 1,72,065.39 crore in 2014-15 . While for Telangana it has increased to Rs . 2,21,055.58 crore from Rs . 1,60,554.29 crore during the same period . Thus , the tax revenue doubled in 5 years duration . In fact this tax is regressive in nature i . e ., the heavy burden of tax fell on common people . Moreover , the deficit in the foreign exchange current account reached dangerous level since 2008-09 due to oil imports . Still , the government refuses to take any measures to control it .
The decline in Public Transportation system not only raised the sales of automobile products but also became a source of livelihood to vehicle drivers . Now , the rise in the prices of petrol and diesel throws them into critical conditions . The All India Motor Transport Congress estimates that as many as 14 million drivers of trunks , tourist vehicles , small transport
Class Struggle