Despite being governed by the Central Government of India, Arunachal Pradesh and Uttarakhand have different fuel prices. This disparity tends to spark curiosity and raises questions about the factors that contribute to this price difference. Today, let's discuss some of the key reasons behind the price difference in the field of fuel.
Arunachal Pradesh, in particular, stands out as a state that has been consistently paying a higher fuel price than most other states. While many reasons can be attributed to this situation, it is vital to understand the reasons behind this disparity. This will also enable you to decipher whether you can expect improvements on the horizon for Arunachal Pradesh. Let's find out!
Reasons Why Arunachal Pradesh is Paying a Higher Fuel Price Than Uttarakhand
Arunachal Pradesh's higher fuel prices compared to Uttarakhand can be due to several factors. These price differences impact the commercial costs of various dependent items. Let's explore some of the most important reasons behind this price disparity:
Market dynamics
One of the primary reasons for Arunachal Pradesh paying a higher fuel price is the internal issue of market dynamics.
The fuel market in Arunachal Pradesh is characterised by high volatility, with a limited number of players meeting people's demands.
The scarcity of options is one of the major reasons that has resulted in consistently increasing dealer commissions, driving the fuel price much higher than anticipated.
However, the market in Uttarakhand is different. The fuel market in Uttarakhand is robust, with several big players operating in the field.
The presence of healthy competition among these players has led to standard pricing for everyone.
This competitive environment has enabled Uttarakhand to avoid paying excessively high fuel prices, unlike Arunachal Pradesh.
Demand supply analytics
When market demand is more than supply, there is a high chance of an increase in fuel price. Limited supply means that those who are willing to pay higher prices will obtain the fuel they need.
This is the current situation in Arunachal Pradesh. There is a substantial demand for fuel in the state. As a result, fuel prices in Arunachal Pradesh remain quite high and are unlikely to decrease anytime soon.
When it comes to Uttarakhand, fuel prices are low because the demand for fuel is sufficiently met. The supply can easily meet the needs of individuals, preventing a shortage of fuel in the market.
The stable demand-supply balance enables Uttarakhand to maintain a consistent and affordable fuel price. It is expected that this favourable scenario will continue in the future.
Infrastructure and maintenance
Arunachal Pradesh continues to face the problem of inadequate infrastructure, which requires considerable investments to be made.
This lack of infrastructure contributes to an increase in fuel prices, which are passed on to consumers through higher commercial prices.
The government needs to take proactive measures to address this problem and decrease the fuel price. It remains a major issue in Arunachal Pradesh. Even stakeholders in the fuel sector have repeatedly voiced their concerns on this matter.
On the other hand, Uttarakhand does not encounter such an infrastructure-related issue. The state has a well-developed infrastructure, enabling better storage and maintenance.
This, in turn, positively impacts fuel pricing and makes the fuel cost much more sustainable.
If you compare the fuel prices of Arunachal Pradesh and Uttarakhand, you will find that Uttarakhand pays significantly less. This is mostly due to the better infrastructure in Uttarakhand.
Transportation of fuel
Furthermore, a significant factor contributing to the higher fuel price in Arunachal Pradesh compared to Uttarakhand is the cost of fuel transportation.
Arunachal Pradesh doesn't have any pipeline that can efficiently transport fuel without delays or compromising its quality. This is why the state has to invest in more expensive modes of transportation, which leads to an increase in the price of fuel.
However, Uttarakhand benefits from access to cheaper transportation sources. This provides a significant advantage and helps in keeping fuel prices low.
Conclusion
Fuel prices are not fixed and are subject to change. If the government of Arunachal Pradesh takes certain measures, the price could be reduced.
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