"UDF government does not justify the Centre's decision to increase prices. But we are committed to bringing some relief to people and are bringing down sales tax on petrol. With this decision, petrol price will come down by Rs 1.63 per litre," Chief Minister Oommen Chandy told reporters after a special cabinet meeting here today.
Stating that Kerala would stand to lose Rs 218 crore through the decision, he said the state had already asked the Centre to reconsider the petrol price hike.
The government has also decided to introduce austerity measures and to check use of petrol by government offices, the Chief Minister said.
The petrol price was hiked yesterday by a record Rs 7.54 per litre, as rupee had a free fall, an unpopular decision that was attacked by allies of UPA government who demanded its immediate rollback holding it as unacceptable.
Petrol price in Delhi has been hiked by Rs 7.54 per litre to Rs 73.18 a litre. In Mumbai it will cost Rs 78.57 per litre as against Rs 70.66 a litre. In Kolkata, Rs 77.88 per litre and Chennai Rs 77.53 a litre.
Earlier in the day, the Uttarakhand government decided to waive off VAT on the increased amount, providing a relief of Rs 1.87 per litre to the people of the state.