Against the backdrop of a no OPEC+ deal, crude oil prices could remain elevated in the near term with global recovery continuing to dig its heels deeper.

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Jul 08, 2021

Excise duty on fuel: Battle of fisc vs. inflation

A Rs 5 reduction in petrol and diesel excise duty will reduce retail prices by ~5% having a direct impact of about 8-10 basis points of softening on both CPI and WPI inflation, and an equivalent amount of indirect or second order impact. On the fiscal side, it will imply a revenue loss of ~Rs 57,500 cr in the remainder of FY22 to Centre’s exchequer. Can the Government absorb this loss?