Retail prices of petrol have dropped by 3-5 per cent and diesel prices have come down by 5-8 paise a litre even as the government today effected a hefty increase in the excise duty on the two petroleum products. The new prices took effect from January 11-12 midnight.
The excise duty on petrol has been increased from 32 per cent to 90 per cent and that on diesel from 16 per cent to 20 per cent. The duty changes are valid till the end of the current financial year.
The government expects to mop up an additional Rs 1,200 crore from the hike in excise duty on petrol and Rs 400 crore through the revised excise rates for diesel during the remaining period of 2001-02.
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Petroleum minister Ram Naik told reporters the increased duty would not add to the oil pool deficit which would remain at the current level of around Rs 11,000 crore in case the international prices of crude oil continued to rule around the current level of $20 a barrel.
Naik said following the increase in excise duty, the petroleum ministry decided to adjust the ex-storage point prices of petrol and diesel in a manner that the increase in the excise duty rates did not result in an increase in the retail selling prices of these two petroleum products. In fact, the adjustments in the ex-storage point prices with the new duty structure have resulted in the prices coming down throughout the country.
For example, in Delhi, petrol prices have come down from Rs 28.93 a litre to Rs 27.54 a litre, in Mumbai from Rs 31.90 a litre to Rs 30.79 a litre, in Chennai, from Rs 30.67 a litre to Rs 29.74 a litre and in Kolkata, from Rs 29.21 a litre to Rs 27.99 a litre.
In case of diesel, retail prices in Delhi have come down from Rs 17.17 a litre to Rs 17.09 a litre, in Mumbai from Rs 20.79 a litre to Rs 20.71 a litre, in Chennai from Rs 18.65 a litre to Rs 18.60 a litre, and in Kolkata from Rs 17.54 a litre to Rs 17.47 a litre.
Naik said the government had decided to liquidate 80 per cent of the oil pool deficit at the end of the current fiscal through issue of 7 per cent oil bonds. The balance 20 per cent would be taken care of after the Comptroller and Auditor General (CAG) certifies it.
The minister, however, conceded that this would result in around 4 per cent