Fuel price hike becomes new flashpoint between BJP & Congress in Karnataka

The cost of petrol and diesel would increase by at least Rs 3 across Karnataka.

Just as the dust settles on a long and intense election campaign, the Karnataka units of the BJP and Congress are battling it out again. This time, the bone of contention is the decision taken by the Siddaramaiah government to hike state sales tax on petrol and diesel. As a result, the cost of petrol and diesel would increase by at least Rs 3 across Karnataka. The BJP was quick to react, with the state president BY Vijayendra announcing state-wide agitations until there is a rollback. The Congress for its part defended its actions, arguing that despite the hike, the cost of fuel in Karnataka will still be lower than in other BJP-ruled states.

Interestingly, the Congress's reasoning also highlights a broader centre versus state debate on revenue collection. Karnataka home minister MB Patil argued that the additional revenue is needed to fund developmental programmes and the five guarantees. Siddaramaiah went on to suggest that the Centre's GST policy forced his government to take this decision. He claimed that the Centre has not released GST revenue that was owed to Karnataka. As a result, this was the only possible way to increase state revenue collection given the circumstances. The debate over GST is not something that is emerged all of a sudden. Back in February, members of the Karnataka Congress had travelled to Delhi to urge the Centre to 'release' GST revenue that was owed to Karnataka. Attempts were also made to make it an election issue, suggesting that the central government is against the interests of Karnataka. This time around, with Siddaramaiah bringing up the GST issue as justification, the fuel price hike could develop into a centre vs state issue.

The hike is a delicate issue for the Congress. On the ground, the move is most definitely going to be unpopular and could have a knock-on effect on the cost of public transport. The state Congress is clearly trying to mitigate the impact by pinning the blame on the central government. They have also linked the hike to the party's five guarantees. Given the popularity of the Karnataka government's welfare schemes, the Congress would be hoping that this would cushion some of the negative fallout.

The BJP, on the other hand, views this as an opportunity. Despite the BJP's strong performance at the Lok Sabha elections, the state unit still faces an uphill task. The state unit is still reeling from the 2023 assembly elections defeat. It still has to come up with a counter to the Congress's popular five guarantees. The fuel price hike offers an important opportunity for the BJP's state unit to hit back at the Congress. The BJP has planned state-wide protests against the decision demanding a rollback. BY Vijayendra issued a statement arguing that the fuel price hike is a fallout of the financially imprudent five guarantees. With the state exchequer under severe strain, the government was left with no other choice.

The BJP's attack has not been limited to the state level. Central leaders like Hardeep Singh Puri have also joined in the debate. He argued that the decision could result in fuel prices going up by as much as Rs 8. The Union minister compared the price to other BJP-ruled states, suggesting that the fuel prices in Karnataka are some of the highest in the country. Puri went on to highlight how the central government in 2021 had cut excise duties on fuel to reduce prices. Nationally, this Karnataka Congress's decision gives the BJP much needed ammunition. Following an election in which unemployment and price rise were major concerns for voters, the BJP has sensed an opportunity.

The war of words between the Karnataka units of BJP and Congress over the fuel price hike is a snapshot of what is likely to take place over the next few years. Though assembly elections only due in 2028, the stakes are high for both parties. Following the 2023 assembly elections, the Siddaramaiah government has clearly put the state BJP on the backfoot. The BJP is likely to use every opportunity to corner the Siddaramaiah government and alter the narrative on the ground. The fuel price hike was a golden opportunity.