The Government of India has finally increased the prices of Diesel by as much as Rs 5.62 per litre! Thankfully, the Govt. has decided to let the petrol prices remain untouched by reducing excise duty by Rs 5.50 per litre.
The decision was taken by the cabinet committee of political affairs and is an attempt to reduce the fast increasing oil subsidy of Rs 187,127 crores. State-owned oil firms have been losing about Rs 6 per litre on petrol but the reduction in excise duty should bring down this loss to a huge extent. However, this decision has faced a strong criticism from TMC and SP.
The biggest-ever Diesel price hike comes a little more than a year after the previous Diesel price hike of Rs 3.37 per litre.
While the decision will do a world of good to our economy, an increase in diesel prices means that even Diesel car owners haven’t been spared from increasing fuel prices. What worries us the most is the affect that Diesel price increase will have on the prices of essential commodities.
Now that diesel prices have been increase, can inflation be far behind?