Indian Energy Alert | Fuel & Milk Prices Hike | Gold Import Ban & Sugar Export Halt Explained | N18V

Added: 2026-05-15

[00:00:00]There have been certain key decisions which have been taken by the government over the last few days and the biggest of them all of course has been an increase in the prices of petrol and diesel as well as CNG. And there's a reason behind it and the reason happens to be the Gulf crisis over which the Indian government or any country for that matter has no control. As long as the Strait of Hormuz remains shut, the mobility of the tankers getting the supplies of crude oil, energy products as well as LPG is very much limited and restricted as well. So as the Prime Minister made the appeal that people will have to learn to conserve so as to avoid a larger crisis in future becomes extremely critical. So let's look at the various attempts which are being made by the government to ensure that we don't have a very critical fiscal crisis in future. First of all, the oil manufacturing companies have been reporting a massive loss or under-recovery as it's called over 1,000 crores per day. Till now, it was being reimbursed by the Finance Ministry, but how long can the Finance Ministry keep on doing so? The OMCs are a bit happy with the fuel hike, but they feel that this is not enough. The rise should have actually been triple the time, an amount which has been announced, but you know the government has also tried to keep in mind the consumer sentiment. So to a certain extent, the under-recoveries or losses faced by the oil manufacturing companies will be taken care of. Uh more than that, our current account deficit is also rising. Our foreign exchange reserves are likely to be impacted. That is because our import bills are also rising. Of the top three import products which India increasingly has as is [music] that of crude oil, the second is fertilizer, and the third is gold. Which is why the Prime Minister also made an appeal to the people that you try and cut down on the purchase of non-essential gold. Well, in here too, the government has taken a big step and that big step has been to increase the import duty on gold by up to 10 to 15%. But more than that, restrictions have now been imposed on the import of gold as well. This is going to be reviewed periodically, and the reason why this has been done is to cut down on our import bills. Also, to ensure the availability of gold with the RBI because that is how you arrest the inflationary tendencies as well. With the collateral damage of the Gulf crisis and these kind of restrictions on fuel prices are obviously going to be felt on the essential commodities and products.

[00:02:29]Obviously, the transport costs are likely to increase over a period of time. The prices of fruits and vegetables are also likely to increase because of the increased transportation costs. One of the first items we saw an increase was on milk. All varieties of milk prices were raised by 2 rupees by both Amul as well as Mother Dairy, who are the two biggest brands of milk available in the country. And the reason given by them was of increase in input costs. You know, that it involves infrastructural costs as well, transportation costs as well. So, these are the big products which have been measures which have been taken. There's also a ban as far as export of sugar is concerned. This is again to ensure the availability of sugar. But there's an interesting side to it. Sugar byproduct, like molasses, is used to manufacture ethanol. Now, ethanol is looked upon as an alternative to petrol and diesel or as an energy fuel. We know that we're not only looking at newer routes for procuring these important crude oil, but also alternative resourcing, for example, ethanol. And the recent Union Cabinet decision to give a boost up or a fillip to coal gasification, to convert coal into gas which can be used in place of LPG or CNG. So, these are some of the big bang measures which have been taken by the government to ensure that fiscal crisis in future does not reach an alarming level. We are so far better off by in contrast to many other countries, but we don't want to reach that stage, which is why the government in the coming days may take similar more decisions as well.