Converging the Divergence between Diesel and Petrol Prices

Undertaken By: Integrated Research and Action for Development,    Recent Publication: 2017

This report evaluates the case for reducing the existing price differential through a revenue neutral equalisation of the central excise duties that are levied on diesel and petrol. It assesses the impact of the revision in excise rates on state government finances, truck freight, farmers, car manufacturers and bus operators and passengers, and concludes that a move towards parity of excise rates would not pose a major hurdle to any group of stakeholders. Rather, it will help eliminate some perverse incentives.