Petroleum Secretary S Sundareshan, while addressing a press Conference on Friday, announced the government’s decision to deregulate prices of petrol. Petrol prices shall now be subject to periodic revisions based on fluctuations in market prices. An immediate hike of Rs. 3.50 per litre has already been affected. Prices of diesel shall be deregulated in stages while those of kerosene and LPG shall continue to be regulated by the government. For the moment, diesel has been hiked by Rs. 2 per litre, kerosene by Rs. 3 per litre and LPG by Rs. 35 per cylinder. Crude to retail: Pricing and under-recoveries India imports about 80% of its crude oil requirement. Therefore, the cost of petroleum products in India is linked to international prices. The Indian barrel of crude cost $78 in March 2010. Once crude is refined, it is ready for retail. This retail product, is then taxed by the government (both Centre and State) before it is sold to consumers. Taxes are levied primarily for two reasons: to discourage consumption and as a source of revenue. Taxes in India are in line with several developed nations, with the notable exception of the US (See Note 1) Before the current hike, taxes and duties in Delhi accounted for around 48% of the retail price of petrol and 24% of the retail price of diesel. (Click Here for details) Ideally, the retail prices of petroleum products should then be determined as: Retail prices = Cost of production + taxes + profit margins However, in practice, the government indicates the price at which PSU oil companies sell petroleum products. Since these oil companies cannot control the cost of crude (the primary driver of the cost of production) or the taxes, the net result is an effect on their profit margins. In cases where the cost of production and taxes exceeds the prescribed retail price, the profit margins become negative. These negative profit margins are called ‘under-recoveries’. When international crude prices rose above $130 in 2008, under-recoveries reached an all-time high of Rs. 103,292 crore. Even at much lower prices in 2009-10 (averaging at $70 per barrel), under-recoveries totalled Rs. 46,051 crore. (See Note 2) The latest move is an effort to reduce these under-recoveries. The government cited the recommendations of the Kirit Parkih Committee while announcing its decision (Summary - Kirit Parikh Committee report). Any alternatives to price hike? As is evident from above, under-recoveries can also be reduced by decreasing taxes. In fact, one might argue that by both taxing the product and offering a subsidy, the government is complicating the situation. Usually whenever subsidization coexists with taxation, it serves the purpose of redistribution. For example, taxes might be collected universally but subsidy be granted to the weaker sections only. However, this is not the case in the current situation. What needs to be noted here is that these taxes are a very significant source of revenue. In fact, the total taxes paid by the oil sector to the central and state governments were around 3% of GDP in 2008-09 (See Note 3). Reducing taxes now might make it difficult for successive governments to raise taxation rates on petroleum products again. Moreover, though taxes are levied both by the Centre and the States, the subsidy is borne only by the Centre. Hence, the current arrangement is beneficial to the States. Possible future scenarios The opposition has voiced concerns that the hike in prices is likely to lead to even higher inflation and will further burden the consumer. The Chief Economic Advisor to the Finance Ministry, Dr. Kaushik Basu, however, told the media that these changes would have a beneficial effect on the economy. According to him,
"The (decontrol of petrol prices), coupled with price increase for LPG (cooking gas) and kerosene, will have an immediate positive impact on inflation. I expect an increase of 0.9 percentage points in the monthly Wholesale Price Index (WPI) inflation".
However, he added, that since the hike in fuel prices would push down fiscal and revenue deficit,
"they will exert a downward pressure on prices… More importantly, from now on, if there is a global shortage and the international price of crude rises, this signal will be transmitted to the Indian consumer. It will rationalise the way we spend money, the kinds and amount of energy we use, and the cars we manufacture. It is an important step in making India a more efficient, global player”.
It remains to be seen how the actual situation pans out. Notes 1) Share of tax in retail price (%)
| Country | Petrol | Diesel |
| France | 61% | 46% |
| Germany | 63% | 47% |
| Italy | 59% | 43% |
| Spain | 52% | 38% |
| UK | 64% | 57% |
| Japan | 48% | 34% |
| Canada | 32% | 25% |
| USA | 14% | 16% |
| India (Del) | 48% | 24% |
Source: Petroleum Planning and Analysis Cell, PRS (Data as of Feb, 2010) 2) Under-recoveries by oil companies (Rs Crore)
| Year | Petrol | Diesel | PDS Kerosene | Domestic LPG | Total |
| 2004-05 | 150 | 2,154 | 9,480 | 8,362 | 20,146 |
| 2005-06 | 2,723 | 12,647 | 14,384 | 10,246 | 40,000 |
| 2006-07 | 2,027 | 18,776 | 17,883 | 10,701 | 49,387 |
| 2007-08 | 7,332 | 35,166 | 19,102 | 15,523 | 77,123 |
| 2008-09 | 5,181 | 52,286 | 28,225 | 17,600 | 103,292 |
| 2008-09 | 5,151 | 9,279 | 17,364 | 14,257 | 46,051 |
Source: Petroleum Planning and Analysis Cell, PRS 3) Contribution to Central and State taxes by Oil Sector (2008-09)
| Category | Rs (crore) |
| Sales tax | 63,349 |
| Excise duty | 60,875 |
| Corporate tax | 12,031 |
| Customs duty | 6,299 |
| Others (Centre) | 5,093 |
| Other (State) | 4,937 |
| Profit petroleum | 4,710 |
| Dividend | 4,504 |
| Total | 1,61,798 |
Source: Petroleum Planning and Analysis Cell
The counting of votes for General Election 2019, which concluded on Sunday, will begin tomorrow, i.e., 23rd May at 8 AM. The election was conducted in 7 phases for 543 constituencies of Lok Sabha. The Election Commission of India (ECI) uses Electronic Voting Machines (EVM) to conduct elections. Since 2000, ECI has conducted 113 assembly elections and three general elections using EVMs.[1] Voter Verified Paper Audit Trail (VVPAT) system was added to EVMs in 2013 to increase transparency and improve voter confidence in the system. The VVPAT system generates a printed paper slip bearing the name and election symbol of the candidate. On April 8, 2019, Supreme Court instructed the ECI that printed VVPAT slips from randomly selected five polling stations in each assembly segment of a parliamentary constituency should be matched with EVMs.[2] In this blog, we explain the election counting process in India.
Who is responsible for counting the votes?
The Returning Officer (RO) is responsible for conducting elections in a constituency, which also includes counting of votes.[3] The RO is an officer of the government or a local authority nominated by the ECI for each constituency in consultation with the state government.[4]
Where does the counting take place?
The RO decides the place where the votes will be counted for the parliamentary constituency. The date and time of counting is fixed by the ECI. Ideally counting of votes for a constituency should be done at one place, preferably at the Headquarter of the RO in that constituency. It should be performed under the direct supervision of the RO. However, each Parliamentary Constituency has multiple assembly segments. In this situation, counting can take place at different locations for various assembly segments under the direct supervision of an Assistant Returning Officer (ARO).
Layout of the Counting Hall
Page 431, Handbook for Returning Officer Document 23 Edition 1, Election Commission of India
Counting of votes for each assembly segment of a parliamentary constituency is performed in a single hall. In each round of counting, votes from 14 EVMs are counted. In case of simultaneous parliamentary and assembly elections, such as Odisha, the first seven tables are used for counting votes for assembly elections, and the rest for parliamentary elections.
In constituencies with a large number of candidates, it may not be possible to count votes for all candidates in a single hall without overcrowding it. In such a situation, the number of counting halls or tables can be increased with the prior permission of the ECI. A hall can also be used for counting votes of another assembly segment after the results of the first segment are declared. However, counting may be done for only one assembly segment in a hall at any point of time.
What is the counting process?
Counting is performed by counting supervisors appointed by the RO. Counting staff is appointed through a three stage randomisation process to ensure impartiality. Candidates along with their counting agents and election agents are also present in the counting hall.
Counting of votes begins with Electronically Transmitted Postal Ballots (ETPB) and Postal Ballots (PB). These votes are counted under the direct supervision of the RO. Counting of EVMs can start 30 minutes after the commencement of PB counting, even if all PBs have not been counted. At the end of each round of counting, the results from 14 EVMs are declared.
What is the process for counting VVPAT slips?
The ECI prescribes the process for randomly selecting one EVM for each assembly segment of a parliamentary constituency for VVPAT matching. The verification of VVPAT paper slips is conducted inside a secured VVPAT Counting Booth in the counting hall with access to authorised personnel only. Any counting table in the hall can be converted into VVPAT Counting Booth after completing EVM vote counting. Parliamentary constituencies generally have between five and ten assembly segments.
The Supreme Court has decided that VVPAT slips of five randomly selected polling stations for each assembly segment shall be matched with the result shown in the respective EVMs. This implies that VVPAT paper slips need to be matched for about 25-50 machines for each parliamentary constituency. This process requires personal supervision of RO/ARO. The ECI has decided that the counting of five VVPATs will be done sequentially.[5] The RO can declare the final result for the constituency after the VVPAT matching process has been completed.
What happens if there is a discrepancy between the VVPAT count and the EVM results?
In such a case, the printed paper slips count is taken as final. The ECI has not clarified whether there would be any further action (such as counting of all VVPATs in a constituency or assembly segment) if there is a discrepancy in the counts of one of the five VVPATs.
[1] https://www.eci.gov.in/files/file/8756-status-paper-on-evm-edition-3/.
[2] N Chandrababu Naidu and Ors. v. Union of India and Anr WP(C). 273/2019 decided on April 8, 2019.
[3] https://www.eci.gov.in/files/file/9400-hand-book-for-returning-officer-february-2019/.
[4] https://www.eci.gov.in/faqs/elections/election-machinery/faqs-election-machinery-r1/.
[5] https://www.eci.gov.in/files/file/10197-mandatory-verification-of-vvpat-paper-slips-regarding/.
