State elections prompt reduction in oil prices

Arun Jaitley,Fuel price hike,Finance minister

In a major relief for consumers, the government on Thursday reduced excise duty on petrol and diesel by Rs 1.50 per litre and said the oil marketing companies (OMC) will absorb the impact to the tune of Re 1 per litre. AAP government in New Delhi is also unlikely to cut the fuel prices.

Additionally, the union minister was generous enough to urge the state governments to follow the Center's footsteps and cut down the rates of petrol and diesel.

After the minister's announcement, Jharkhand, Gujarat, Chhattisgarh and Maharashtra too announced a reduction in fuel prices.

Maharashtra's Chief Minister Devendra Fadnavis has just announced an additional relief of Rs 2.5/litre resulting in a total Rs 5/litre drop in petrol prices.

"The government's aim is to give relief to the consumer by increasing their purchasing power without impacting the fiscal deficit", he said.

With assembly elections due later this year in Madhya Pradesh, Rajasthan and Chhattisgarh, where the BJP has high stakes, the decision came a day after the Union Cabinet chose to hike minimum support price for Rabi crops.

"The government's capacity to provide relief is only when domestic factors are strong", he said.

In India, nearly half of the price of retail fuel is due to taxes. This will reduce the overall price by about Rs 5.

From April 1 to October 1 this year, the difference in the petroleum products' cost and freight (C&F) price for refineries and the price at which they were sold to dealers had already narrowed from Rs 4 to Rs 2 a litre for petrol and from Rs 4 to Rs 3 a litre for diesel. In.

Jaitley said the move followed Brent crude oil touching four-year high of Dollars 86 a barrel Wednesday and interest rates in U.S. reaching seven-year high. Soon, several other NDA-ruled states - Chhatisgarh, Tripura, Jharkhand, Madhya Pradesh, Uttar Pradesh, Haryana, Assam, Uttarakhand, Goa, Himachal Pradesh and Arunachal Pradesh - followed suit. Prices have seen a similar hike in other cities as well.

The Minister also maintained that Thursday's decision does not represent a re-regulation of fuel prices.

India's government has introduced a fuel relief as prices at the pump rise inexorably, following soaring worldwide benchmarks, Indian media report, citing the official statement by Finance Minister Arun Jaitley. Yesterday, media reported that the Modi government had allowed local companies affected by the rise in oil prices to borrow internationally up to US$10 billion.

Meanwhile, reports are coming in that Delhi, led by AAP will not cut Value-Added Tax on petrol and diesel.

However the opposition-ruled states refused to toe the Centre's line.

Karnataka chief minister HD Kumaraswamy said he would not reduce taxes on fuel.

"The Centre had hiked excise duty by ₹10 and reduced it by only ₹2.50".

Related:

Comments

Latest news

Champions League: Livescore from Napoli vs Liverpool
Dossena had a brief spell at Liverpool towards the end of the 2000s before he returned to Italy with Napoli in January 2010. They tried everything and were really busy, but not smart enough or calm enough in the right moments.

Cubs-Brewers Set For National League Tiebreaker
One day after letting their division titles slip away, the Chicago Cubs and Colorado Rockies find themselves facing elimination. With the Red Sox, Lester allowed three runs in Game 7 of the American League Championship Series in a loss to the Rays in 2008.

Trump to female reporter: You're not thinking. You never do
He later returned to the question she had asked him about Kavanaugh in which he defended his nominee to the Supreme Court again. The transcript issued hours later omitted Vega's word " thinking " and showed Trump saying, 'I know you're not thanking '.

OnePlus major leak reveals Android flagship OnePlus 6T in full glory
In all likelihood, the OnePlus 6T will be powered by the Snapdragon 845 SoC and will be available in two memory configurations. Even before its official launch, courtesy of leaks and renders , we know nearly everything about the upcoming OnePlus 6T .

Other news