Graphic: India's petrol, diesel prices surge to record

by Frankie Norman May 27, 2018, 0:36
Graphic: India's petrol, diesel prices surge to record

According to the analysts, the continuous increase in petrol and diesel prices is related to the weakening of the rupee against the U.S. dollar.

Prices of petrol and diesel have been continuously rising after voting to the Karnataka assembly election was held on May 12.

At a press conference on Tuesday, BJP president Amit Shah said the government was concerned about the hike in fuel prices and would meet the oil companies.

Another option before the government is to convince the states on bringing petrol and diesel under the GST regime.

Rising pump prices are already adding to inflationary pressure and are strengthening the case for a rate hike. "The rise in prices is completely outside the government's [control]".

The prices has come into effect at 6 am today. It is result of this all that petrol prices have hit highest level under present government and diesel too is at record high these days.

The revisions continued till just before the general elections in 2004 when oil companies went slow and after a Congress-led UPA came to power the entire process was reviewed as the worldwide oil prices started moving up. It is possible to cut up to ₹25 per litre, but the government will not. Until June 2015, the government subsidised India's oil refiners and marketers such as Indian Oil, HPCL and BPCL. Basically, the problem is "taxes" which are imposed by the government on petrol and diesel.

Mumbai residents are also facing the brunt of fuel price hike as the price of petrol touched Rs 84.70 per litre, while diesel hiked a record high of Rs 71.66 per litre in the metropolitan city. In addition to it, states have Value-Added Tax the rates of which vary from state to state. We are trying to build a consensus in GST Council on bringing petroleum under GST.

He said that "Central government saves Rs 15 on every litre of petrol due to fall in crude oil prices. The Centre has given Maharashtra in last four years what was not given in the last 20 years", he claimed.

India is known for its "high taxing framework" and crude prices are the victim of the same. Under GST, the maximum tax slab is that of 28 per cent whereas the government is collecting much higher taxes by keeping petrol and diesel out of GST.

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