New Delhi: After the increase in the prices of petrol and diesel by more than Rs 10, companies have stopped their hands for the time being. Amidst this relief to the consumers, the statement of the Chief Economic Advisor (CEA) has raised concerns again.
CEA V Anantha Nageswaran said in a conversation with CNBC TV18 that if the price of crude oil goes above $110 per barrel in the global market, then the burden will have to be borne by the government, oil marketing companies, and consumers. At present, the prices of oil in the domestic market are high because due for various reasons the supply in the global market has been affected and companies are also importing expensive oil from outside.
Nageswaran said that these situations have arisen due to the crisis in the global supply and it is not a matter for anyone to face this inflation. That is why I am saying that if the price of crude remains above $ 110, then the government will have to bear the burden of oil companies and common people as well. The government will also try its best to provide relief and that includes steps like tax cuts.
The government is giving relief elsewhere
The Chief Economic Advisor said that the tax collected by the government on petrol and diesel is being used in other relief schemes. The government has increased the scope of the Pradhan Mantri Garib Kalyan Yojana so that the facility of the free ration can be given to the poor and laborers of the country for some more time.
Despite this, in November last year, the excise duty on petrol and diesel was reduced by Rs 10, which brought direct relief to all consumers. On the question of whether the excise duty cut again will affect the revenue of the government, he said that it depends on the quantum of deduction.
America can increase the problems of the world
The CEA did not say anything about the Reserve Bank’s decision not to change the repo rate for the 11th time in a row but expressed concern over the US Fed Reserve’s indications of raising interest rates. He said that the statement of the Fed Reserve is shocking that interest rates will be increased continuously in the coming times.
If the Fed is to be believed, it can increase interest by 2.75 percent by the end of 2023. By the end of the first quarter, there will be two meetings of the Fed Reserve. If the Fed raises interest rates in the May and June meetings, then its effect will be visible on the economies of the world.
