New Delhi: The Centre's move to slash customs duty on cement, various raw materials and capital goods is expected to hit revenues amounting to Rs3,000 crore over the next two months.

The move to cut duty across 11 product categories comes a month before the Union Budget for 2007-08 and is apparently aimed at checking inflation which is on the rise.

The headline inflation for the week ended January 6 had risen to 6.12 per cent, the highest in two years, causing concern to the Government and its supporting parties.

The finance minister P Chidambaram said the government was planning to take this step anyway on February 28, but had decided to advance it because it has the potential to check inflation, especially in the manufacturing sector.

The finance ministry on Monday announced removal of customs duty on cement, specified capital goods, project imports and carbon black feedstock. It also cut customs duty on calcined alumina, ferro alloys stainless steel and other alloy steel. Customs duty on primary and semi-finished forms of copper, aluminium, zinc, tin and other base metals have also been reduced. Cement companies feel that the move could have a restraining effect on domestic prices.