Low-cost diesel not meant for SUVs and cars: Dharmendra Pradhan

The government has been keeping the retail price of diesel low as it was used in public transport and for running pump sets for agricultural operations and the subsidy is not meant for its use in SUVs and cars, minister of state for petroleum and natural gas Dharmendra Pradhan  said.

Addressing a workshop on 'Converging the Divergence between Diesel and Petrol Prices' in the national capital on Wednesday, the minister said India has a long history of imposing taxes / duties on petroleum products, viz, petrol and diesel, and these taxes / duties have been rationalised from time to time to insulate the domestic consumers against increase in price or to increase the revenue of the government for developmental projects.

Highlighting the recommendation made by the expert group chaired by Kirit Parikh on converging the divergence between diesel and petrol prices, Pradhan said that apart from taxes / duties, others factors like technology, disruptive technology, renewable energy impact etc shall also be taken into consideration.

He further said that once the petroleum products come into the ambit of GST, the issue of tax rate differentials will be automatically resolved.

The minister said that diesel is used for agricultural purpose and for public transport and these are the reasons why the taxes/duties on diesel are kept lower compared to petrol. He stressed that the low cost diesel is not meant for SUVs and cars.

Keeping in view the emissions concern, Pradhan said that Bharat Stage VI (BS VI) for petrol and diesel vehicles will be introduced by April 2020 and it will be as clean as CNG. The refineries are being upgraded for BS VI production with an investment of Rs30,000 crore, he added.

The minister said that after the roll out of daily pricing of motor spirit (MS) and high speed diesel (HSD) from June 2017, there has been a better synchronisation with international prices and also enhanced logistics management for oil industry.

During the occasion, the minister also released a book titled 'A case for rationalise of the central excise duty'.

The workshop was organised by Integrated Research and Action for Development (IRADe). The workshop included presentation session on impact of diesel and petrol price rationalisation and different panel discussions on state finances, trucking sector, oil marketing companies, buses sector, cars sector and agriculture sector.