Retail fuel tax pressure grows

摘要

India's business-friendly BJP government has cut federal taxes on gasoline and diesel, after record-high pump prices for transport fuels sparked protests ahead of elections in key states. Prime minister Narendra Modi's administration already faces criticism over a three-year low economic growth rate and job growth slowing to its weakest in a decade. His government has pared federal taxes on gasoline and diesel by 2 rupees/litre (3￠/l) to contain public anger. Gasoline and diesel cost Rs80/l and Rs63/l, respectively, in Mumbai, the country's commercial capital. Global crude prices are around $53/bl, less than half of their value in early 2014, when the BJP won power. The government has taken advantage of the lower oil values to phase out retail price subsidies and hike retail fuel taxes to raise federal revenue.