Fuel excise cut on the cards?
Indian crude basket touched a high of $49.84 per barrel in December 2020, petrol price in Delhi reached to an all-time high of Rs 84.20 per litre today against the earlier high of Rs 84 per litre in 2018.
Indian crude basket touched a high of $49.84 per barrel in December 2020, petrol price in Delhi reached to an all-time high of Rs 84.20 per litre today against the earlier high of Rs 84 per litre in 2018.
CNBCTV18 learns from various sources that the Prime Minister’s office met officials from the revenue department and ministry of petroleum natural gas to ascertain on a possible excise cut.
“The ministry has given a suggestion to give relief on excise duty to consumers as the welfare of consumer is a responsibility of the ministry. Any decision on excise has to be made by the revenue department and it will ultimately take a decision based on fiscal and inflationary position” said government source on condition of anonymity.
After the festive season, retail fuel prices saw an upward trend at the end of November 2020 and starting December 6, 2020, there was a month-long pause on fuel prices. Even though retail prices are connected to international product prices and is calculated on a 15 days lag, starting January 6th the retails prices began to increase across India.
Today Delhi saw an all-time high price for petrol at Rs 84.20 per litre as against Rs 84 per litre in 2018 when the Indian crude basket was at a high of $80 per barrels.
Retail Fuel price at an all-time high
January 7, 2021
| Cities | Petrol Rs/litre | Diesel Rs/Litre |
| Delhi | 84.20 | 74.38 |
| Mumbai | 90.83 | 81.07 |
| Kolkata | 85.68 | 77.97 |
| Chennai | 86.96 | 79.72 |
January 6, 2021
| Cities | Petrol Rs/litre | Diesel Rs/litre |
| Delhi | 83.97 | 74.12 |
| Mumbai | 90.60 | 80.78 |
| Kolkata | 85.44 | 77.70 |
| Chennai | 86.75 | 79.46 |
Earlier all-time high retail price
October 4, 2018
| Cities | Petrol Rs/litre | Diesel Rs/Litre |
| Delhi | 84 | 75.45 |
| Mumbai | 91.34 | 80.10 |
| Kolkata | 85.80 | 77.30 |
| Chennai | 87.33 | 79.79 |
The government hiked excise duty twice in 2020, followed by a hike in state levies which are pinching the consumers. Petrol saw a hike of 65 percent and diesel 101 percent on account of excise duty increase in 2020.
| Fuel Type | Excise Duty (Rs/ltr) March 1 | Excise Duty (Rs/ltr) March 20 | Excise Duty (Rs/ltr) May 6 Petrol | Change from March 1 to May 6, 2020 |
| Petrol | 19.98 | 22.98 | 32.98 | 65.1% |
| Diesel | 15.83 | 18.83 | 31.83 | 101.07 |
Some corners in the central government are worried that even if the government reduces the excise duty on petrol and diesel, it is not confident states will follow or may rather resort to increase in levies, leading to no respite for consumers.
The finance ministry in its last monthly economic report highlighted that collection from excise duties rose by 47.7 percent during the first 8 months of FY21.
(Edited by : Anshul)
First Published: Jan 7, 2021 9:33 AM IST
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