On Petrol & Diesel prices, RBI Governor suggests Centre & States hammer out tax reduction

On Thursday, RBI Goverr Shaktikanta Das highlighted how high fuel prices t only impact cars and bike users but also manufacturing, transportation and or aspects as well. While dressing 185th Foundation Day Celebration of Bombay Chamber of Commerce and Industry, he aired his views on how diesel and petrol prices have an impact on cost side. 

Das vised that Centre and states need to coordinate ir efforts and reduce taxes. He observed how price of fuel and politics surrounding it often become part of a tug-of-war between Centre and states as each collects indirect taxes from fuel sales and neir is generally willing to compromise due to revenue considerations.

Earlier, in his own remarks on high fuel prices, Petroleum Minister Dharmendra Prhan h me yet ar pitch for petroleum products to be brought under GST but indicated that hold-up in this regard was on account of Finance Ministry and various states still t being on same p. Apart from this Prhan cited crude-side supply and pricing issues, highlighting that India has attempted to pressure OPEC and OPEC+ nations to be more judicious in ir approach.

RE | Mamata Banerjee Rides Electric Scooter To Bengal Secretariat In Protest Against Fuel Rates

Impact of Manufacturing on cost of production

Das said in such a situation (where neir states r Centre are willing to compromise on fuel rates) need for revenue and compulsion of governments are fully understood. But re is also a need to understand that it also has an impact on inflation. Higher prices of petrol and diesel have an impact on cost of manufacturing, he said. Inflation is main lookout of RBI.

RE | Congress' Udit Raj Gives Communal Spin To Fuel Price Hike; BJP's Meenakshi Lekhi Responds

RBI is working on 'Digital Currency'

Reserve Bank of India is working on Digital Currency and a progress document will be released soon with a comprehensive guideline, said Das amid renewed interest in cryptocurrencies. He ded that manufacturing sector is working to improve pace of growth. With this, MSME sector of country has come forward as ecomy's engine of growth. Goverr also stressed need for companies to invest more in healthcare sector.

RE | India's Petrol & Diesel Rates High Due To Global Crude Rates & Demand Destruction: Prhan

RE | Petrol & Diesel Prices In India Per State: How Much Fuel Costs In States, Cities On Feb 22

(With ANI Inputs)