Indian government has just pulled off 2 big steps to control raising fuel prices. But NOBODY knows about the 2nd one! Step 1. Cut Fuel Taxes Govt reduced central excise duty on petrol and diesel to cushion consumers from rising global crude prices. Petrol excise duty is reduced from... ₹13 to ₹3 per litre. Diesel duty was cut from ₹10 to ₹0. But this relief comes at a cost. Every Re 1 per litre reduction results in an annual revenue loss of Rs 14,000-16,000 crore. A Rs 10 cut could therefore lead to a revenue impact of nearly Rs 1.5 trillion for the Centre. But, the obvious question is how is this gap being managed? Step 2: Increased export duties. On same day, govt reimposed windfall taxes of ₹21.5 per litre on diesel exports and ₹29.5 per litre on aviation turbine fuel exports. Because India’s large private refiners, like Reliance and Nayara, can export refined fuel when overseas margins are attractive. Export duties do 2 things at once: they help recover some revenue, and they make excessive exports less attractive so more fuel stays available for the domestic market. It gives relief to consumers and recovers part of the cost from exporters. All while managing domestic supply & prices. Let me know what do you think about this move. And for, no-noise breakdowns of everything that matters to India, follow along. Jai Hind. Jai Bharat. 🇮🇳show more

Praffulgarg

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