India protected its consumers from oil shock as West Asia crisis rattled world economies
New Delhi, June 29
As the West Asia crisis rattled global economies with surging oil and gas prices since the US-Iran war began on February 28, the defining choice of the crisis for India was to absorb the cost at the level of the State and the public sector marketing companies rather than the household, according to the government, as no comparable economy chose to shoulder a burden of this scale on behalf of its consumers.
The contrast with India is sharpest among the import-dependent economies that slid from price pressure into physical shortage.
Sri Lanka, still recovering from its 2022 collapse, reintroduced mandatory petrol rationing within a fortnight and moved the public sector to a four-day week, its registration portal crashing as millions rushed to sign up.
Pakistan closed schools, shortened the working week and played its cricket behind closed doors to keep traffic down.
Myanmar combined odd-even driving with QR-code rationing, Bangladesh posted troops at its oil depots, and Ethiopia routed fuel to security forces and essential industry, suspending distribution altogether in Tigray.
The wealthier importers avoided rationing by leaning on their reserves and their budgets. Japan ran down its strategic stock and subsidised the pump, South Korea capped prices for the first time in thirty years, and across the European Union, 22 of its 27 members had together spent over nine billion euros on relief by mid-April, with Germany cutting its fuel tax and Hungary releasing reserves that were soon reported running low.
Even oil producers were not spared at the pump -- the United Arab Emirates (UAE) saw diesel rise about 85 per cent and Nigeria's citizens squeezed by transport costs despite the windfall to its exporters.
Where the market was left to clear the rise was steep, diesel up about 80 per cent in New Zealand, petrol up a fifth in the United Kingdom and California past five dollars a gallon.
The International Energy Agency's largest-ever coordinated release, about four days of world demand, signalled how grave the supply position was judged to be.
"India did none of this. It declared no emergency, rationed no household, shortened no working week, closed no school and ordered no driving ban. The only curbs it applied were on commercial and bulk LPG and on the export of diesel and aviation fuel, and these were to protect the domestic household, allocation rather than rationing," according to Petroleum Ministry.
After an initial scare on cooking gas, the household cylinder kept arriving. Retail pumps stayed open, and the rise at the pump was the smallest of any major economy.
India was then among the first to unwind its measures, the commercial and bulk LPG restrictions lifted by June 25. The contrast is the clearest measure of the dividend of a decade of energy-security investment and of strategic autonomy in practice, according to the ministry.
— IANS
Reader Comments
Okay, but let's be honest — we haven't completely escaped unscathed. The commercial and bulk LPG restrictions hit small businesses and restaurants hard. My uncle's dhaba had to scramble for cylinders for weeks. And the export ban on diesel and aviation fuel? That's India protecting its own, sure, but it also means less revenue for our economy. Still, I'm grateful my household didn't face shortages. Just wish the little guy got a bit more support during those weeks.
The contrast with other nations is stark. Pakistan closing schools and playing cricket behind closed doors to save fuel — that's desperation. India's investment in strategic petroleum reserves and diversifying oil suppliers paid off in spades. But we shouldn't be complacent. The West Asia crisis isn't over and if things escalate further, even our reserves might not hold. Need to keep pushing for renewable energy and domestic production. Self-reliance is the only long-term answer.
Impressive handling by India compared to many other countries. I'm from the US originally, and even we saw gas prices spike above $5 a gallon in California. To see India maintain normalcy while economies like Sri Lanka and Myanmar went into full crisis mode is remarkable. The strategic autonomy point in the article is spot on — India made its own choices rather than just following the herd. That's real sovereignty in action.
As someone living in the UK, I can tell you the petrol price rise was brutal there — up a fifth in a few months. People were complaining non-stop. Coming to India for a visit right now, it's night and day difference. Pumps are full, no queues, no panic. The government absorbing the cost instead of passing it to households is a masterstroke, even if it meant a hit to the exchequer. Hope this lesson sticks when we plan for future energy crises.
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