India increases fuel taxes in a bid to shore up revenue

Published March 14, 2020
The excise duties on the fuel have been hiked by 3 rupees per litre. — AFP/File
The excise duties on the fuel have been hiked by 3 rupees per litre. — AFP/File

India on Saturday increased taxes on petrol and diesel in a desperate attempt to increase government revenue at a time when tax collections have fallen amid the weakest economic growth in six years.

The excise duties on the fuels, which have been hiked by 3 rupees per litre, is expected to result in up to 400 billion Indian rupees ($5.42 billion) increase in revenue, a senior government official told Reuters.

Taxes on petrol and diesel, which account for more than a third of retail fuel prices, are one of the biggest sources of income for Prime Minister Narendra Modi’s government, which has more than tripled revenue from taxes on fuel since first coming to power in 2014.

India stopped controlling petrol prices in 2010 and diesel prices in 2014, linking them to global crude markets in a bid to ease pressure on government finances and improve the earnings of oil refiners.

Global oil prices posted their biggest week of losses since the 2008 global financial crisis, rocked by the coronavirus outbreak and efforts by top exporter Saudi Arabia and its allies to flood the market with record levels of supply.

Follow Dawn Business on X, LinkedIn, Instagram and Facebook for insights on business, finance and tech from Pakistan and across the world.

Opinion

Editorial

Missing in action
17 Mar, 2026

Missing in action

NOT exactly known for playing a proactive role in protecting the interests of Muslim nations and populations...
Risk to stability
Updated 17 Mar, 2026

Risk to stability

THE risks to Pakistan’s fragile economic recovery from the US-Israel war on Iran cannot be dismissed. Yet the...
Enrolment push
17 Mar, 2026

Enrolment push

THE federal government has embarked upon the welcome initiative to enrol 25,000 out-of-school children in Islamabad...
Holding the line
16 Mar, 2026

Holding the line

PAKISTAN’S long battle against polio has recently produced encouraging signs. Data from the national eradication...
Power self-reliance
Updated 16 Mar, 2026

Power self-reliance

PAKISTAN’S transition to domestic sources of electricity is a welcome development for a country that has long been...
Looking for safety
16 Mar, 2026

Looking for safety

AS the Middle East conflict enters its third week, the war’s most enduring victims are not those who wage it....