War On Inflation: Modi Govt Announces LPG Subsidy, Sharp Cut In Petrol & Diesel Prices

| Updated: 21 May, 2022 8:55 pm IST
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NEW DELHI: In a big relief to consumers, the Modi government on Saturday announced a sharp cut in central excise duty on fuel prices, bringing down the price of petrol by Rs 9.5 per litre and diesel by Rs 7.

The Central government has slashed the excise duty on petrol by Rs 8 per litre and by Rs 6 per litre on diesel, Finance Minister Nirmala Sitharaman announced.

In a series of tweets, she said that the Centre will lose Rs 1 lakh crore due to the cuts on the excise duty.

“I wish to exhort all state governments, especially the states where reduction wasn’t done during the last round (November 2021), to also implement a similar cut and give relief to the common man,” the minister tweeted.

Once the announcement comes into effect on Sunday, petrol will cost Rs 95.91/litre as against Rs 105.41/currently, while diesel price will fall to Rs 89.67/litre as opposed to Rs 96.67/litre on Saturday.

In addition, the government will also provide a subsidy of Rs 200 per gas cylinder with a cap of 12 cylinders per year to more than nine crore beneficiaries of Pradhan Mantri Ujjwala Yojana. The government will bear an expense of Rs 6100 crore in a year to give the subsidy.

“This will help our mothers and sisters,” Sitharaman said.

Reiterating its commitment to ensure the uninterrupted supply of cheap fertilizers to farmers, the government announced additional subsidy amount of Rs 1.1 lakh crore.

“In addition to the fertilizer subsidy of Rs 1.05 lakh crore in the budget, an additional amount of Rs 1.10 lakh crore is being provided to further cushion our farmers,” Sitharaman informed.

In order to control inflation amid global food and energy crisis, the Centre also announced to reduce the customs duty on raw materials and intermediaries for plastic products with high import dependence. “This will result in reduction of cost of final products.”

Soon after the announcements, Prime Minister Narendra Modi underlined his government’s “always people first policy” and said that decision will provide relief to common man.

“It is always people first for us! Today’s decisions, especially the one relating to a significant drop in petrol and diesel prices will positively impact various sectors, provide relief to our citizens and further ‘Ease of Living’,” he tweeted.

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