Petrol and diesel price have reached a record high in India with no respite. It must be noted that petrol prices have crossed the Rs 90-mark in all metro cities including Delhi.Also Read - After Centre's Fuel Price Cut, Kerala Reduces State Tax on Petrol And Diesel by THIS Much
Why diesel and petrol prices are rising in India?
The government reasons that global crude oil prices have risen by more than 50 per cent to over $63.3 per barrel since October, forcing oil retailers to increase pump prices. That, however, is only partly true. Indian consumers are already paying much higher than what they were paying last January, even though crude prices are yet to reach levels of early last year. Pump prices of both fuels in other countries are just reaching pre-pandemic levels, while Indian consumers are shelling out a lot more. Also Read - What Will Be The Prices Of Petrol, Diesel In Delhi, Mumbai, Other Cities After Reduction in Excise Duty
So to give clarity, the state and central government both levy taxes on the fuel. Therefore, the current price rise is largely due to the steep increase in taxes of petrol and diesel. Also Read - Centre Slashes Excise Duty On Petrol By Rs 8 Per Litre, Diesel By Rs 6 to Curb Rising Inflation | Check Revised Rates Here
Earlier, in April 2020 the fuel prices had come down as the country entered a complete lockdown in wake of the covid 19 pandemic. However, as economies around the world focus on revival with reduced travel restrictions and increased factory output, the global demand has improved directly affecting the price hike.
Another reason is Budget 2021 which has also imposed a new agriculture infrastructure and development cess. It must be noted that state and central taxes are about 180 per cent of the base price of petrol and about 141 per cent of the base price of diesel in Delhi.
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