Iran Crisis: Why Did Modi Govt Slash Excise Duty On Petrol-Diesel?

As the Centre slashed the excise duties by Rs 10 on Friday in view of global energy crisis, Union Minister for Petroleum and Natural Gas Hardeep Singh Puri and Finance Minister Nirmala Sitharaman praised the Prime Minister's decision, claiming that it is taken to safeguard the Indian citizen.

He also explained why the Centre has cut the excise duty.

The international crude oil prices surged over the last month over the Middle East crisis, triggered after Israel-US carried a joint operation on Iran.

In a post on X, he said, "International crude prices have gone through the roof in the last 1 month from around 70 dollars/barrel to around 122 dollars/barrel. Consequently, petrol and diesel prices for consumers have gone up all over the world. Prices have increased by around 30%-50% in South East Asian countries, 30% in North American countries, 20% in Europe and 50% in African countries."

He stated that the BJP government had two choices - either increase prices drastically for citizens of Bharat as all other nations have done or bear the brunt on its finances so that Indian citizen is insulated from international volatility."

The Minister said that PM Modi decided to take a hit on its own finances again to safeguard the Indian citizen.

On her turn, Sitharaman said that the central excise duty on petrol and diesel for domestic consumption has been reduced by ₹10 per litre each in view of the West Asia crisis.

She continued, "This will provide protection to consumers from rise in prices. Hon. PM @narendramodi has always ensured that citizens are protected from vagaries of supply and costs of essential goods.

Further, duties have been imposed on exports of Diesel at ₹21.5 per litre and on ATF at ₹29.5 per litre. This will ensure adequate availability of these products for domestic consumption. The Parliament has been notified about the same."

The Centre on Friday cut excise duties for petrol and diesel bringing them down to Rs 3 per litre of petrol and zero for a litre of diesel. On the other hand, the windfall tax on export of diesel has been fixed at 21.5 rupees/litre.

The development comes amid a global energy crisis due to the US-Israel war on Iran. Also Tehran-imposed blockade on the Strait of Hormuz added to the crisis.

On the other hand, India bought 12 to 15 per cent of that oil.

With inputs from ANI