Finance Minister, Arun Jaitley announced at a press conference in New Delhi today that the Centre has decided to cut fuel prices by Rs 2.50.
Jaitley said the price cut will be absorbed by Centre and the Oil companies. At the same time, he said the states must also cut taxes.
The move includes an excise duty cut of 1.5 rupees per litre, Jaitley said, with oil marketing companies absorbing 1 rupee per litre.
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 the government, and a sensitive issue for voters.
Modi’s ruling party is facing a tough election in three key states this year followed by a national election due by May.
Pradhan meets FM as fuel prices touch new high.>