Pricing of public services

The cost of 1 water tanker is more than the monthly water bill that we pay.

The cost of purchasing the invertor/UPS/generator is more than 2 year of electricity bill. Add to it the running cost and the diesel fumes etc. State electricity board electricity is not only cheaper but much more convenient.

The cost of public transport (bus, local trains, metro) is substantially less than auto, taxi or even self-driven vehicles.  Railway Trains are cheaper than bus, flight or cars. LPG is cleaner, greener and more convenient that its alternatives chopping trees for firewood or burning the smoky kerosene stove.

As an educated, smart and savvy statesman interested in public welfare what would you do? Well it’s no brainer that you would invest in the cheaper & more convenient for the mass public. After-all power-plants are not only cheaper but also greener (per unit electricity produced) than a private generator. Public transport can go a long way in reducing congestion, pollution and making urban life more affordable etc. etc.

But you cannot! Why because Indians are like crabs in the basket. They are Ok with not being able to escape poverty, but they will surely drag down anybody else who wishes to.

We want electricity to be provided free of cost, water is already provided free of cost, bus fares have increased by 5-10% over the last decade (while diesel and salaries have increased 5 folds), railway prices have remained untouched since the Independence of this country (well at least for the last decade).

Public enterprise is no different than a business the profit it generates paves way for further investment and expansion of service. In absence of appropriate pricing the services are either shut-down or will suffer with years of neglect & underinvestment. (Some subsidized services like healthcare, police generate profit through the economic development and social impact).

You don’t expect your grocery store to stock your kitchen and feed you for free. The rent you pay motivates the builders and landlords to develop new & modern real-estate. Similarly the price you are willing to pay for public utilities funds for better services. If we are willing to pay for it then we might as well move to forest. (Water in the streams is free, firewood/energy is free, nobody will tax you for walking)

In the 80s, my father used to joke that although the entire west have a Communist-phobia USA, UK & Western Europe is more communist than the so called communist countries. (With reference to unemployment benefits, pension policy, disability and maternity support) Today in Shanghai I am getting some top notch capitalistic advice. What’s more the gentleman even said that India’s communistic & populist policies will undo whatever economic development it has. Isn’t the world is so different from what it appears to be.

 

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