Decision on fuel price hike may come on Saturday
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Government may raise prices of petrol, diesel and LPG on Saturday, after a week-long consultations at the highest level narrowed on a package to bailout cash-strapped oil PSUs due to high global oil prices.
“A Cabinet meeting is being scheduled for tomorrow morning to consider raising fuel prices and possibly a minor duty tinkering,” a Cabinet source said.
Four options may be put up to the Cabinet on Saturday, raising petrol price by Rs 3, 4, 5 or 7 per litre and diesel by Rs 1, 2, 3 and 4 per litre. Besides Rs 20 per cylinder hike in domestic LPG price may also be proposed.
“In all probability, petrol price may be raised by Rs 3 per litre, diesel by Rs 2 and domestic LPG by Rs 20,” the source said.
Prime Minister Manmohan Singh has multiple brainstorming sessions with Finance Minister P Chidambaram, Oil Minister Murli Deora, Planning Commission Deputy Chairman Montek Singh Ahluwalia and External Affairs Minister Pranab Mukherjee on ways to curtail the projected Rs 225,000 crore revenue loss on sale of petrol, diesel, domestic LPG and kerosene this fiscal.
UPA Chairman Sonia Gandhi has also been consulted. Besides price rise, customs duty on petrol and diesel may be cut from current levels of 7.5 per cent, and at least Re 1 per litre reduction in excise duty on the two is also on cards.
A one rupee hike in petrol and diesel price would give Indian Oil, Bharat Petroleum and Hindustan Petroleum Rs 1,036 crore and Rs 4,575 crore additional revenues on the two fuels respectively during the remaining 10 months of the fiscal. The Rs 20 hike in LPG prices would yield Rs 1,200-1,300 crore.
A one rupee cut in excise on petrol would result in revenue loss of Rs 1,380 crore to the government and a similar reduction on diesel would decrease revenues by Rs 5,270 crore.
“A Cabinet meeting is being scheduled for tomorrow morning to consider raising fuel prices and possibly a minor duty tinkering,” a Cabinet source said.
Four options may be put up to the Cabinet on Saturday, raising petrol price by Rs 3, 4, 5 or 7 per litre and diesel by Rs 1, 2, 3 and 4 per litre. Besides Rs 20 per cylinder hike in domestic LPG price may also be proposed.
“In all probability, petrol price may be raised by Rs 3 per litre, diesel by Rs 2 and domestic LPG by Rs 20,” the source said.
Prime Minister Manmohan Singh has multiple brainstorming sessions with Finance Minister P Chidambaram, Oil Minister Murli Deora, Planning Commission Deputy Chairman Montek Singh Ahluwalia and External Affairs Minister Pranab Mukherjee on ways to curtail the projected Rs 225,000 crore revenue loss on sale of petrol, diesel, domestic LPG and kerosene this fiscal.
UPA Chairman Sonia Gandhi has also been consulted. Besides price rise, customs duty on petrol and diesel may be cut from current levels of 7.5 per cent, and at least Re 1 per litre reduction in excise duty on the two is also on cards.
A one rupee hike in petrol and diesel price would give Indian Oil, Bharat Petroleum and Hindustan Petroleum Rs 1,036 crore and Rs 4,575 crore additional revenues on the two fuels respectively during the remaining 10 months of the fiscal. The Rs 20 hike in LPG prices would yield Rs 1,200-1,300 crore.
A one rupee cut in excise on petrol would result in revenue loss of Rs 1,380 crore to the government and a similar reduction on diesel would decrease revenues by Rs 5,270 crore.
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