Govt Hikes Excise Duty On Petrol, Diesel By ₹2/Litre Amid Global Price Dip

The Indian government has decided to raise excise duty on petrol and diesel by ₹2 per litre, a move that will directly impact fuel prices across the country from April 8, 2025.

The government made the decision to hike fuel prices despite a fall in global crude oil prices, aiming to bolster revenue amid global economic uncertainties.

Price Hike Despite Global Trend

Ironically, the announcement arrives at a time when international oil prices are showing a downward trend.

Concerns of a potential global trade war, triggered by the United States’ imposition of reciprocal tariffs under the administration of President Donald Trump, have dampened demand expectations and driven down crude prices globally.

Impact On Consumers

Consumers are bracing for a fresh wave of price pressures.

The hike in fuel prices will likely drive up transportation costs, which in turn will raise the prices of goods and services across multiple sectors.

For households already grappling with rising inflation, the additional fuel cost could further strain monthly budgets.

Economists and industry experts have questioned the timing of the move, even as the government aims to enhance revenue collections, particularly in a pre-election year.

With inflationary trends already troubling middle-class and low-income families, a fuel price hike may prove politically and economically risky.

Government’s Official Notification

The Ministry of Finance, in its latest notification, confirmed that the revised excise duty rates would come into effect from April 8.

Petrol and diesel prices will reflect this hike immediately, and oil marketing companies are expected to adjust retail prices accordingly.

Experts warn that rising fuel costs could have a cascading effect on the broader economy.

“An increase in fuel prices doesn’t just impact vehicle owners, it affects logistics, supply chains, and commodity prices across the board,” said a senior economist.

Given the current global volatility and fragile recovery, any additional price shocks may dent consumption and economic momentum.

As the nation adjusts to the impending hike, attention will be on how state governments respond either by reducing VAT to soften the blow or allowing prices to rise further.

With inflation management a key concern for both central and state authorities, this development is likely to remain in the spotlight in the coming weeks.

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