prime Minister Narendra Modi, who faces elections in key states later this year, and a nationwide election in early 2019, has confronted strain over a upward push in retail prices of petrol and diesel to a report stage.
India has the very best retail costs of petrol and diesel among South Asian international locations as taxes account for about forty-50 percentage of the pump expenses.
A litre of petrol prices seventy two.23 rupees ($1.thirteen) while diesel is offered at 63.01 rupees. Petrol and diesel account for approximately 1/2 of India's subtle gas consumption.
"we can simplest advise. it's far as much as the finance ministry to take a choice," a senior oil ministry authentic said.
A cut in excise obligation on petrol and diesel inside the finances, because of be unveiled on Feb. 1, would pose challenges as the government is suffering to tackle a widening fiscal gap amid falling tax revenues due to the implementation of a goods and services tax (GST) regime from July.
In 2016/17, the petroleum sector contributed round five.2 trillion rupees ($81 billion), about a 3rd of overall sales receipts, for federal and country finances.
India raised excise obligation nine times between November 2014 and January 2016 to shore up federal finances as international oil charges fell, but then cut the tax closing October via 2 rupees a litre.
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