oppn parties Government Is Unlikely To Lower Fuel Prices

News Snippets

  • In a first, the Supreme Court recognizes marital rape, although for the limited purpose of allowing married women the right of abortion up to 24 weeks if they conceived as a result of forced sex by their husbands
  • Air India cuts discounts on base fare to students and senior citizens from 50% to 25%
  • Mallikarjun Kharge and Digvijay Singh are being touted as frontrunners to take on Shashi Tharoor in the elections for the post of Congress president
  • Sonia Gandhi will decide who will be Rajasthan CM if she feels there is a need to change guard after the near-rebellion by MLAs in the state
  • Ashok Gehlot bowed out of the race for being Congress president after meeting Sonia Gandhi
  • India has moved to the 40th spot in the innovation index, up 6 spots from last year
  • DGGI has alleged that top insurance companies, banks and NBFCs has committed a fraud of Rs 800cr by claiming input tax credit without underlying supplies
  • The Centre will borrow Rs 10000cr less than planned earlier due to good revenue collections
  • At $23.9bn, India's current account deficit widened to 2.8% in Q1, the worst in four years
  • Stocks continue to flounder on Thursday: Sensex sheds 188 points to 56409 and Nifty 40 points to 16818
  • The 36th National Games were declared open on Thusrday by PM Modi in front of a record crowd in Motera near Ahmedabad
  • Jasprit Bumrah most likely to miss T20 World Cup due to recurrence of back injury
  • PFI's political wing, the SDPI is on EC radar and action will follow soon if discrepancies are detected
  • Ashok Gehlot to meet Sonia Gandhi today, says all issues will be sorted out soon
  • Referring to the PFI ban, most Muslim organizations ask the government to take similar action against right wings organizations like the RSS, Bajrang Dal, VHP and the like
In a landmark order, Supreme Court rules that all women, married or unmarried, are entitled to safe and legal abortion up to 24 weeks of pregnancy as per the MTP Act
oppn parties
Government Is Unlikely To Lower Fuel Prices

By A Special Correspondent
First publised on 2021-06-28 08:11:23

The price of petrol and diesel was increased by 35 pasie and 25 paise respectively on Sunday. With this, fuel prices have been raised 31 times since May 4. During this period, petrol has become costlier by Rs 8.06 per litre and diesel by Rs 8.17 per litre.

After the Sunday revision, petrol is selling at Rs 98.46 and diesel at Rs. 88.90 in Delhi. In Mumbai, petrol is Rs 104.56 and diesel Rs 96.42. Several other cities and towns have also seen petrol rates cross the Rs. 100 mark.

Will this upward trend continue and will both petrol and diesel continue to sell at close to or over Rs100 from now on?

A note issued by ICRA, prepared by its chief economist Aditi Nayar, has worked out that there is enough scope for the government to reduce the prices by up to Rs. 4.50 per litre and still generate revenue at last year’s level.

Working on a model of increased demand in the current year and a freeze on further taxes, the note says that petrol consumption is expected to grow at 14% and diesel at 10% in 2021-22 on the low base of 2020-21. The increased sales will mean that the government will rake in Rs 360000 crore this year compared to Rs 320000 crore it got last year. If the government is willing to forego this additional Rs 40000 it is expected to earn, it can reduce the price of fuel by Rs 4.50.

While this is a good analysis, it has been seen that the government is financing a major part of its additional expenditure due to the pandemic through increased revenue from fuel. Hence, although it should, it is not going to cut fuel prices and consumers will continue to have to pay close to Rs100 or more for both petrol and diesel for some time now.