<p>Taking advantage of the collapse in global crude prices, the centre Saturday hiked the excise duty and cess on petrol and diesel by Rs 3 each, a move that could fetch it close to Rs 2,000 crore in the next 15 days and nearly Rs 40,000 crore in the next financial year.</p>.<p>The hike has been done under the head – special additional excise duty (SAED) – which allows the Centre to keep entire accrual with itself, without sharing the same with states.</p>.<p>The cumulative hike of Rs 3 per litre on both fuels includes a road cess of Re 1 a litre. This is the steepest hike in excise duty in the recent times. Petrol will attract an excise duty of Rs 22.98 per litre and diesel, Rs 18.83 per litre after Saturday's increase in duty.</p>.<p>The increase has come at a time when expectations were high that the government would pass on the benefit of lower oil prices to consumers in order to boost an acute shortage in consumption and demand conditions in the country owing to a slump in its economy.</p>.<p>The government decided to raise duty and cess after the crude oil prices crashed on Monday, with Brent falling to $32 per barrel from around $66 per barrel when Saudi Arabia pledged to boost output after talks between OPEC countries, Russia and others to cut production, failed.</p>.<p>The steep fall in Brent crude prices, however, did not translate into any significant drop in petrol and diesel prices in India. Petrol prices came down by only about 72 paise per litre since then.</p>.<p>A back-of-the-envelop calculation suggests that a $1 decline in crude leads to 65 paise per litre decline on petrol prices and 52 paise per litre on diesel provided the rupee remains stable at 70.</p>.<p>Officals said rupee depreciation was partly responsible for oil prices almost remaining where they were.</p>.<p>Experts, however, said that the rupee has not depreciated more than 2.5% since January and that despite the depreciating rupee, the government could have gained significantly. The Opposition Congress, quoting a member of Prime Minister Economic Advisory Council, said that government has gained close to Rs 3.4 lakh crore due to the crash in oil prices.</p>.<p>The Modi government has increased excise duty on transport fuel several times since it came to power in 2014, making the duty go up by almost 100% in the past six years. India imports about 80% of its oil requirement.</p>
<p>Taking advantage of the collapse in global crude prices, the centre Saturday hiked the excise duty and cess on petrol and diesel by Rs 3 each, a move that could fetch it close to Rs 2,000 crore in the next 15 days and nearly Rs 40,000 crore in the next financial year.</p>.<p>The hike has been done under the head – special additional excise duty (SAED) – which allows the Centre to keep entire accrual with itself, without sharing the same with states.</p>.<p>The cumulative hike of Rs 3 per litre on both fuels includes a road cess of Re 1 a litre. This is the steepest hike in excise duty in the recent times. Petrol will attract an excise duty of Rs 22.98 per litre and diesel, Rs 18.83 per litre after Saturday's increase in duty.</p>.<p>The increase has come at a time when expectations were high that the government would pass on the benefit of lower oil prices to consumers in order to boost an acute shortage in consumption and demand conditions in the country owing to a slump in its economy.</p>.<p>The government decided to raise duty and cess after the crude oil prices crashed on Monday, with Brent falling to $32 per barrel from around $66 per barrel when Saudi Arabia pledged to boost output after talks between OPEC countries, Russia and others to cut production, failed.</p>.<p>The steep fall in Brent crude prices, however, did not translate into any significant drop in petrol and diesel prices in India. Petrol prices came down by only about 72 paise per litre since then.</p>.<p>A back-of-the-envelop calculation suggests that a $1 decline in crude leads to 65 paise per litre decline on petrol prices and 52 paise per litre on diesel provided the rupee remains stable at 70.</p>.<p>Officals said rupee depreciation was partly responsible for oil prices almost remaining where they were.</p>.<p>Experts, however, said that the rupee has not depreciated more than 2.5% since January and that despite the depreciating rupee, the government could have gained significantly. The Opposition Congress, quoting a member of Prime Minister Economic Advisory Council, said that government has gained close to Rs 3.4 lakh crore due to the crash in oil prices.</p>.<p>The Modi government has increased excise duty on transport fuel several times since it came to power in 2014, making the duty go up by almost 100% in the past six years. India imports about 80% of its oil requirement.</p>
