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Page last updated at 09:41 GMT, Thursday, 5 June 2008 10:41 UK

India strike over fuel price rise

A protest in Hyderabad against the rise in oil prices on 4 June 2008
The oil price rise is expected to fuel inflation

Communist and opposition parties in India are holding nationwide protests against a 10% rise in fuel prices.

The Communist-governed states of West Bengal, Tripura and Kerala are badly hit by a strike called by the parties who say the rise will fuel inflation.

The government says it had no choice because of surging global oil prices.

India imports nearly 75% of its crude oil requirements but subsidises the cost of domestic fuel products to help contain inflation and protect the poor.

India's Congress party-led government faces key state polls this year ahead of general elections due in 2009.

The BBC's Sanjoy Majumder in Delhi says the party is now worried about the political fallout from its latest move.

Total shutdown

Communist parties, which support the government in Delhi, say more expensive fuel will push prices up across the board. Business leaders take a similar view.

Our politicians should learn to protest without stopping work
Abhijit Sen,
Bengal Chamber of Commerce

In the states of West Bengal and Tripura, where the Communists are in power, there was a total shutdown, the BBC's Subir Bhaumik in Calcutta says.

The Communists as well as the main opposition BJP are also holding protest marches in the capital, Delhi, and other cities across the country.

Calcutta saw shops, markets, schools and colleges closed. All flights to and from Calcutta airport have been rescheduled.

Vehicles, including buses and trams, largely stayed off the roads and many staff at government offices did not go to work.

Many people had trouble getting to their destinations.

"I have to stand in a queue here in pouring rain after having walked two kilometres from my hotel," said visa seeker Sumitra Hazarika Gogoi outside the US consulate.

A protest against the rise in gas prices in Delhi on 4 June 2008
Many people are angry about the price rises

Another strike, called by West Bengal's opposition Trinamul Congress, has been called for Friday.

In Tripura too, schools, colleges, shops and markets were closed and there was little traffic on the streets.

The US consul general in Calcutta, Henry Jardine, said the back-to-back strikes "reflects poorly on Calcutta".

"Your state seeks investments but investors get a wrong message if you have strikes so frequently," Mr Jardine told a business chamber meeting late on Thursday after the strikes were announced.

The business chambers have also criticised Bengal's "strike culture".

'No money'

After debating for almost two weeks, the Indian cabinet finally announced increases in the price of petrol, diesel and cooking gas on Wednesday.

It said the move was necessary because state-owned oil companies were losing millions of dollars every day because of the increase in global oil prices.

The increase - the second this year - comes at a time when inflation is already at its highest level in four years.

"It must be appreciated what has been done is the bare minimum," Prime Minister Manmohan Singh said in an address to the nation on Wednesday night.

"There are limits to keep consumer prices unaffected. This way we will have no money to import oil," Mr Singh said in defence of the price rise.


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