Fuel prices to get cheaper, govt announces excise duty reduction on petrol, diesel ahead of Diwali

Prices of petrol and diesel will thus come down accordingly.

The reduction in excise duty on diesel will be double that of petrol.

"The Indian farmers have, through their hard work, kept the economic growth momentum going even during the lockdown phase and the massive reduction in excise on diesel will come as a boost to the farmers during the upcoming Rabi season," the Indian government said in a statement on Wednesday.

Amid a continuous rise in prices of petrol and diesel in recent months, the Centre cited it to be the effect of global upsurge in crude oil prices.

"Consequently, domestic prices of petrol and diesel had increased in recent weeks exerting inflationary pressure. The world has also seen shortages and increased prices of all forms of energy. The Government of India has made efforts to ensure that there is no energy shortage in the country and that commodities such as petrol and diesel are available adequately to meet our requirements," the Centre stated.

"Driven by the enterprising ability of India’s aspirational population, the Indian economy has witnessed a remarkable turnaround post the COVID-19 induced slowdown. All sectors of the economy – be it manufacturing, services or agriculture – are experiencing significant upward economic activity," it said.

To give a "further fillip to the economy", the Narendra Modi government has decided to significantly reduce the excise duty on diesel and petrol.

The reduction in excise duty on petrol and diesel will also boost consumption and keep inflation low, thus helping the poor and middle classes.

States have been requested to commensurately reduce VAT on petrol and diesel to give relief to consumers.