The central government on Friday raised the commercial supply of liquefied petroleum gas (LPG) for states to 70 per cent of pre-war level, up by 20 per cent, prioritising key industries such as automobiles and steel. The development comes amid the ongoing conflict between Iran, the United States (US) and Israel in the Middle East, which is unlikely to end anytime soon.
Oil Secretary Neeraj Mittal has written a letter to all state chief secretaries, directing them that the additional supply should be prioritised for labour-intensive industries such as steel, automobiles, textiles, dyes, chemicals, and plastics, which support other essential sectors.
"In addition to the existing 50 per cent allocation, an additional 20 per cent is now proposed, that would bring the total commercial LPG allocation to 70 per cent of the pre-crisis level of the packed non-domestic LPG," Mittal wrote.
Excise duty on petrol, diesel slashed
Earlier in the day, the government also slashed the excise duty on petrol and diesel by Rs 10 per litre. With this, the excise duty on petrol is now Rs 3 per litre, while that on diesel has been cut to zero. The government, in a release, said the move has been taken to shield consumers and oil marketing companies (OMCs) from "global oil shock".
It is worth mentioning that India imports nearly 88 per cent of crude oil, but the tensions in the Middle East and Iran's warning to close the Strait of Hormuz has caused global turmoil. Although Indian vessels have been allowed by Iran to pass through the transit point, the uncertainty over global oil supply lines continues to hover.
"The Government had two choices: either increase prices drastically for citizens of Bharat as all other nations have done, or bear the brunt on its finances so that the Indian citizen is insulated from international volatility," said Union Petroleum and Natural Gas Minister Hardeep Singh Puri, adding that the decision was taken to safeguard Indian citizens.
"The Government has taken a substantial impact on its taxation revenues to reduce the high losses being faced by oil marketing companies at this time of sky-high international prices," he added.
