Click to play videoNew Delhi: Will the Finance Minister P Chidambaram give-in and cut excise duties on petrol and diesel? That seems to be the hope of the Petroleum Ministry. CNN-IBN learns that 2007 Budget may reflect a change and this time Congress president Sonia Gandhi is backing the duty cut.
Ten Janpath's call for a cut in petrol and diesel prices last month left consumers smiling but the Petroleum Ministry's case for a change in duty structures in petrol and diesel may put a frown on the Finance Minister's face.
CNN-IBN learns the Petroleum Ministry, once again ostensibly on the behest of the Congress President Sonia Gandhi, wants a review of excise duties.
Currently, excise duty on Petrol is 8.16 per cent with specific duty at Rs 13.26 per litre.
The Petroleum Ministry wants only specific duty on petrol at Rs 15.92 per litre. On diesel, it wants specific duty at Rs 6.8.
Currently, excise duty on diesel is 8.16 per cent with specific duty at Rs 3.32. Petroleum Ministry sources say that the cut in duty structures would be revenue neutral at current level of crude.
But once the Indian basket of crude crosses the $60 dollar, it will cushion consumers from further oil shocks.
But there would be no increase in Government revenues on account of rising crude prices.
The ministry also wants customs on crude to be reduced from 5 per cent to nil. It has also asked for a cut in customs duty on ATF from 10 per cent to 5 per cent.
Sources say that with pressure coming in from 10 Janpath, the Finance Ministry, that has been dragging its feet on excise cut on petroleum products, could be forced to act on it.
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