Tuesday, November 28, 2006

Mr. Chidambaram VS Oil

India's Chidambaram suggests fixing price band for crude oil

Mr. Chidambaram says, “Oil consumers have assured producers that prices will not go below a certain level and producers should in turn assure consumers that prices will not go above a certain level.”

Here he is talking of shoring prices of a commodity. On the other hand he professes free economy and trade.

He wants to direct more money to improving roads, ports and other infrastructure and accelerate economic growth to 10 percent by 2010, from the average 8.2 percent pace of the past three years.

Every fool in the world knows that above will exert ever increasing pressure on the demand side for oil, which in turn will have cascading effect on the real price of oil. In other words, he wants to have one side shoring.

"Oil producing countries must understand that sustained long-term, very high prices of crude will destabilize the world economy,” Chidambaram said.

He should know that, on the otherside, sustained long-term cheap oil prices will destabilize the whole earth.

India lost one percentage point of economic growth annually in the past three years, Chidambaram said, setting back poverty-alleviation efforts.

He should better abolish taxes on oil, which are oiling his rotten apple cart.

He said, “This is the gravest injustice done to developing countries.”

What's he asking for? Charity to get rich...

Mr. Chidambaram, we live in this ruthless world. Stop cribbing and look for alternate sources. Oil will fall automatically.


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