During his interaction with chief ministers through video conferencing on Wednesday, Prime Minister Narendra Modi took into account the rising prices of fuel and urged the states which have not reduced VAT on petrol and diesel to slash it.
Stating that the Centre and state should practice “cooperative federalism”, PM noted that some states did not cut taxes on petrol and diesel after the Centre cut excise duties, saying this is unfair to people there.
PM listed the fuel prices in cities across the country and flagged higher rates in states like Maharashtra, West Bengal, Telangana, Andhra Pradesh, Kerala, Jharkhand and Tamil Nadu. He stated that like India strongly fought a long battle against Covid, the same must be done for economic issues given the impact of global issues like the ongoing “war-like situation”.
The 7 Opposition states that did not cut their rates have earned an extra Rs 11,945 crore as compared to States that cut rates. For the uninitiated, the government had reduced the tax on fuel prices in November 2021, however, some state governments did not follow suit.
Government’s response to Opposition on fuel prices
Meanwhile, the Centre, in its response to the Opposition on higher fuel prices in India, said that India is an oil importing nation, with 80 per cent of our oil requirement being imported from outside. “It is obvious that the price of oil that India imports is affected by global prices and global events,” the government said.
Additionally, the government said that the price of the crude oil available to India for import has grown from $63.4 a barrel in April 2021 to $112.87 a barrel in March 2022 – a 78 per cent increase in one year.
Despite the ongoing world events, fuel prices in India have remained relatively lower in comparison to other major economies that do not produce their own oil, the government said in its response.
India’s fuel prices compared
The petrol and diesel price in India is the second-lowest among other comparable nations heavily dependent on oil imports such as Netherland, Germany, Sweden, Switzerland, Singapore, Italy, Spain, France, South Korea and Japan.
Moreover, India has the 2nd-lowest petrol and diesel prices among BRICS nations, and that too only because Russia is an oil-producing nation.
| Countries | Petrol (Rs/litre) | Diesel (Rs/litre) |
| Brazil | 118.21 | 108.21 |
| China | 111.22 | 99.98 |
| South Africa | 11.69 | 118.90 |
| India | 103.81 | 95.07 |
| Russia | 46.88 | 47.93 |
India has the 4th-lowest petrol prices and the 5th-lowest diesel prices among the eight ASEAN countries for which there is data (there are 10 ASEAN countries).
High fuel prices in non-BJP ruled states
In its response, the government highlighted that 8 of the top 10 states with highest petrol and diesel prices are non-BJP ruled – Andhra Pradesh, Maharashtra, Telangana, Rajasthan, Kerala, West Bengal, Odisha, Chhattisgarh.
