Govt raises fuel duty, LPG prices

Excise duty hike on petrol, diesel is likely to fetch govt upto ₹34,000 crore a year

- Rajeev Jayaswal

The government raised excise duty on petrol and diesel to mop up part of the windfall gains accruing to fuel retailers because of a steep fall in international oil prices following the US' move to levy retaliatory tariffs on exports from around 60 countries.

The move is expected to fetch the government between ₹32,000 crore and ₹34,000 crore a year, and since the duty is a so-called special additional excise duty (SAED), it will not go into the divisible pool and will not be shared with the states.

The government also increased prices of cooking gas by ₹50 per cylinder from Tuesday, although this cost will be borne by consumers.

Experts said India, which imports most of its energy needs, could be building a cushion for dealing with international oil price volatility because of global tariff war triggered by the Trump administration. India imports about 87% crude oil it processes.