Indian government seeks to reassure markets on deregulation of fuel prices

Eileen GuzmanOct 07, 2018

Speaking at a press conference on Thursday, Finance Minister Arun Jaitley announced that the cut will be effected through slashing of excise duty to the tune of Rs 1.50 per litre, while the oil marketing companies (OMCs) will absorb the impact to the tune of Re 1 per litre.

The price cuts would be effective from midnight tonight. He said that Rs 10,500 crore will be the impact of the excise duty cut this year. Central minister Arun Jaitley has also urged state governments to cut down state-VAT to reduce petrol prices further by about Rs 2.5. Stating that the SC's observation calls for debate, Jaitley added, "How then do you restrain any sexual activity in army frontier, school hostel".

"The government's aim is to give relief to the consumer by increasing their purchasing power without impacting the fiscal deficit", he said. Overall, fuel prices had increased by at least 10% in the last month alone.

In Chennai, the petrol price was Rs 84.70 per litre while that of diesel was Rs 77.11 today.

Fadnavis added that the government's decision to cut the Value Added Tax (VAT) on petrol by Rs. 2.50 per litre has been hugely welcomed by the people and the government will bear the losses in the larger public interest. "Thus petrol & diesel wd be Rs. 5 cheaper in the State of Gujarat". The states where the prices have been decreased are Gujarat, Chhattisgarh, Tripura, Jharkhand, Uttar Pradesh, Madhya Pradesh, Maharashtra, Himachal Pradesh, Haryana, Assam, Arunachal Pradesh, Uttarakhand, Jammu and Kashmir and Goa, said reports.

However, the diesel prices were left untouched yesterday by the state government, which said an assessment was being made on this front.

The price for petrol was hiked by 18 paise per litre whereas the price of Diesel saw a rise of 29 paise per litre.

The turnaround was apparently prompted by the robust tax collections in the first half ended September 30. "We have requested the States to make a similar cut". "Each and every state has their own situation [sic], so first, let the letter come".

Tripura too has chose to match the reduction by Rs 2.5 per liter.

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