A Diwali bonanza in the form of a ?no-fuel-price-hike? is being planned by the government. UPA chairperson Sonia Gandhi is understood to have told Prime Minister Manmohan Singh that fuel prices be not revised for the time being. A brief meeting which the Prime Minister had with petroleum minister Murli Deora last week was to convey that alternatives be worked out to prevent another fuel price hike.
A top government functionary confirmed to FE that, despite the international crude oil prices touching $96 a barrel and the Indian basket of crude exceeding $85 a barrel on October 30, the option of increasing the consumer prices of petrol and diesel had been kept as the last resort.
?No price hike for the time being? was the message from the top, he said.
Much to the discomfiture of the finance ministry, rationalising excise duties on petrol and diesel is being contemplated to absorb the impact of high international oil prices on consumer prices of the fuels.
It is proposed that the ad-valorem component of excise be eliminated, thereby reducing the duties by Rs 2 a litre on both the fuels. Currently, excise on petrol and diesel is a combination of ad-valorem and specific rates.