On March 27, the Congress party claimed that the government’s excise duty cuts would not change prices for sellers and consumers and that the relief was only in narrative and not in reality.
The reaction of the country’s main opposition party comes after the Union government reduced excise duty on petrol ₹3 per liter and diesel fully exempt from excise duty.
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The Congress said the government should focus on providing real relief to consumers, instead of “making headlines and fooling people”.
“If you saw the headlines about petrol and diesel prices ‘falling’ and thought the government had offered relief to your pocket, you would be wrong,” the Congress party media said and promotion department head, Pawan Khera, said.
From now on, prices remain the same for sellers and consumers, he claimed.
“What has actually been reduced is the ‘special additional excise duty’, the levy that is payable Oil marketing companies to the government. The words ‘special’ and ‘additional’ reveal how unnecessary this tax is,” Khera said on X.
He pointed out that these companies have been absorbing losses since the outbreak of the conflict Western Asia. “The government has now only agreed to share a small part of this burden but to reduce the ‘special additional’ levy – that too almost a month later,” the Congress leader said.
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“Relief exists, but only in narrative – not in reality. Instead of making headlines and fooling people, the government should focus on providing real relief to consumers,” he said.
In another post, Khera noted that fuel prices have risen over the years, regardless of oil prices.
“Modi’s Masterstroke: Cheaper oil. More expensive fuel. In May 2014, oil cost $106.94 per barrel. Petrol price ₹71.71 per liter and diesel ₹56.71. Fast forward to just before the West Asian conflict – oil dropped to about $70 a barrel. But gasoline was sold for ₹94.72 per liter and diesel at ₹87.62 in Delhi,” he said.
India was also buying oil from Russia at a concessional rate, but the benefit did not translate into relief for consumers, he said. “Because between 2014 and 2026, the government has revised excise duty a total of 21 times, increasing it 12 times. So much for Achche Din!”
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Global oil prices have risen nearly 50 percent since the United States and Israel launched military strikes against Iran on February 28, prompting a massive retaliation from Tehran.
In a notification issued on March 26 Ministry of Finance reduce consumption tax ₹3 liter from ₹13, while the levy on diesel was reduced to zero ₹10. The duty reduction is effective immediately, the ministry said.
“The government has taken a huge hit in tax revenue to ensure that very high losses to oil companies (around Rs 24/litre for petrol and Rs 30/litre for diesel) are reduced at this time of sky-high international prices. At the same time, an export tax has been imposed as international prices of petrol and diesel have skyrocketed,” the minister said, and every refinery exporting abroad will have to pay export taxes abroad. Oil and natural gas said in a post on X.
Despite a sharp rise in international prices, retail pump rates have not been adjusted, putting oil companies’ finances under pressure, news agency PTI said, adding that government cuts are expected to provide some relief to oil companies.
International oil prices reached $119
International oil prices touched $119 a barrel earlier this month before pulling back to around $100 a barrel. India imports 88 percent of its oil and about half of its natural gas. They mostly come through the Strait of Hormuz.
The conflict in West Asia entered its fourth week, disrupting trade routes through the Strait of Hormuz. Tensions escalated after the killing of Iran’s 86-year-old supreme leader, Ayatollah Ali Khameneiin joint US-Israeli military strikes on February 28.
In retaliation, Iran targeted Israeli and US assets in several Gulf countries, causing further disruption to the waterway and affecting international energy markets as well as global economic stability.
If you saw headlines about petrol and diesel prices ‘falling’ and thought the government had offered a relief to your pocket, you’d be wrong.
According to a statement issued by the Ministry of Petroleum and Natural Gas, “All retail outlets are operating as normal across the country,” although there have been reports of panic buying in some areas due to rumours.
