In a first, price of diesel in Odisha exceeds petrol rate

In a first, price of diesel in Odisha exceeds petrol rate

Usually, diesel prices are lower than that of petrol because of lower base price, taxes and dealer commissions.

In Odisha, diesel costs more than petrol
Odisha charges a uniform 26 per cent VAT on both. (File)

With diesel costlier than petrol in the state, Odisha has reportedly created a record in fuel prices in the country and sparked off a showdown between all political parties.

According to information listed on the website of Indian Oil Corporation Ltd (IOCL), diesel in Khordha district on Monday was costlier than petrol by 13 paise. Petrol price stood at a high of Rs 80.38, while diesel is at Rs 80.51.

Usually, diesel prices are lower than that of petrol because of lower base price, taxes and dealer commissions. However, diesel base price, paid by dealers to oil companies, has gone up by around Rs 5 after a spike in global crude oil prices. Also, Odisha charges 26 per cent value-added tax (VAT) on both petrol and diesel, while most states charge a lower VAT on diesel. Diesel is used by farmers in tractors and other agricultural equipment, in commercial transport and its final price has an effect on food inflation.

In 2016, Odisha increased its VAT on diesel and petrol to 26 per cent from 23 per cent, citing a loss of Rs 417 crore due to fall in prices of the two petroleum products in the previous 18 months.


However, with diesel exceeding cost of petrol, State Finance Minister Shashi Bhusan Behera took aim at the Centre for this anomaly. “Either the Centre cannot control oil companies or it has a nexus with them”, he said. The BJD hopes to turn the heat on Union Petroleum Minister Dharmendra Pradhan, expected to be the BJP’s CM candidate during upcoming assembly elections in 2019. Calling the statement “empty politics”, BJP said that while 13 states have reduced taxes on fuel, Odisha government is still considering a reduction. “Everyone knows the Centre cut prices by Rs 2.50”, said state party secretary Prithviraj Harichandan.

The BJP also said that high diesel price in the state will force truckers and other commercial transport operators to fill up vehicles outside the state borders, which may result in revenue loss for the state government.

“I think nowhere in India, diesel costs more than petrol”, said Leader of Opposition in Odisha and Congress leader Narasingh Mishra, slamming both the Centre and the state. “Certainly Naveen Patnaik has some responsibility. He cannot blame the Centre only”.

“However, 26 per cent is not the only problem”, Mishra continued. “What is the Centre doing? As Gujarat CM, Narendra Modi said the Centre (UPA) was anti-national, at a time when international crude price was Rs 135 and petrol in India was at Rs 45”.

“Now as PM, this is his headache… when crude prices are much lower. They (BJP) say value of rupee is decreasing. If so, then isn’t Modi’s bad economy responsible for it? Why is the Centre not including fuel under GST? Now, Modi should be termed anti-national”. “While Odisha government is not responsible for this current surge in diesel price, it is true that it could have cut down taxes on diesel- the poor man’s fuel”, said BJD’s former finance minister Panchanan Kanungo. “They (Odisha government) are unwilling to cut taxes because they are using the money for elections”, he alleged.

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