Modi Government has to answer a few questions over price of petrol and diesel going higher

why are prices of petrol and diesel going up ?

A recent hike in prices of petrol and diesel have stirred a big time debate regarding the pricing structure.  The question is why the prices of petrol and diesel are so high? Despite low international rates for petrol and diesel why is there a constant hike in pricing since Dynamic pricing? Also, there is a serious question on the policy of the central government for Petroleum products.


Why is the Price of petrol and diesel going higher?

During the Manmohan period, the prices of petrol and diesel also went up to an extent that Narendra Modi started to ask Manmohan Singh for resignation for poor administration. The average price per barrel during 2013-14 was $105. The price of petrol over the course of time has reduced to $46 per barrel in 2015-2016 and 2016-17. Then why are the prices of petrol are going higher?

why are prices of petrol and diesel going up
why are prices of petrol and diesel going up

The answer lies in the administration and policy of Central and state governments. The excise duty that is charged over petroleum products has been increased 10 times during the Modi Government. Due to higher excise duty, the government is filling up their pockets and the common man has to suffer. While this might sound hard hitting too many just because of the increase in excise duty, the central excise revenue for diesel and petrol along with the state government has doubled over the last three years.

Price of petrol and diesel going higher
Price of petrol and diesel going higher

This amounts to 3.5% of GDP and must have yielded a whopping 5.24 lakh crore to state and central governments. The question here is that why the common man has to pay extra excise duty on petrol and diesel despite giving taxes already? Why is the government of India charging such higher excise duty on petroleum products?


Alphons kannanthanam the Union Minister of State for Tourism on Saturday said the decision was intentional. He tries to defend the government of India on the matter by saying ” Currently, 67% of the Indian population does not have access to toilets and for construction of toilets funds are required. Further construction of houses and national highways require a much larger amount of funds. The question is why are we paying tax to the government then? is that money not enough? Why were the People of India not informed regarding this step?

What’s the Solution to price hike of petrol and diesel?

Another Loophole in the administration is that Petroleum products such as (Petrol, Diesel, Natural Gas) are kept out of GST. This simply means that a total of 11 excise duties are applied to the import price of crude oil before selling it to the public. When the entire nation welcomed GST as a tax reform why are petroleum products kept out of it ?

A Petition asking Prime Minister and Central Government to Include Petroleum products in GST has been launched to force the Government to look into the matter.

As per the petition


  1. Cost of crude oil: ₹20.19/Lt
  2. After refining, processing, transportation, operational cost(₹9.34/Lt) Price after all this: ₹ 29.53/Lt
  3. After that 72% excise duty(₹21.48/Lt.) is implemented by the central government, Why?: This takes the cost to ₹51.01/Lt, as after 9% CGST Excise(₹2.66/Lt.) the price will be ₹33.19/Lt.
  4. Commission to petrol pump dealers(₹3.23/Lt): Without GST ₹54.24/Lt, With CGST ₹36.42/Lt.
  5. After that 27% VAT is implemented by State Government on Petrol which is ₹14.64/ Lt. gives ₹69.88 as of with 9% SGST it’s ₹39.70/Lt.



There is no denying the fact that GST implied on petroleum products will reduce the cost to an affordable level for the common man. You can also sign the petition by clicking on the link below :


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