Raj slashes petrol, diesel prices by `2.5/litre

NEW DELHI: Ahead of the Bharat Bandh called by the Congress to protest against the unchecked rise in fuel prices, the Rajasthan government announced on Sunday slashing of VAT on fuel prices by 4 per cent. With the latest move, prices of petrol and diesel in the poll-bound state will come down by Rs 2.5 a litre from Monday.

Petrol price is Rs 83.26 a litre in Jaipur while diesel is priced at Rs 77.17 a litre. The new prices will be applicable from midnight of Sunday, agency news reported.

VAT on petrol will be reduced from 30 to 26 per cent and on diesel from 22 to 18 per cent, Chief Minister Vasundhara Raje made the announcement at a public meeting organised in Rawatsar in Hanumangarh district as part of her ‘Rajasthan Gaurav Yatra'. The decision is likely to cost the exchequer an amount Rs 2,000 crore. “We have decided to reduce VAT on diesel and petrol by four per cent, which will provide much-needed relief to the people of the state, be it farmers or women or others,” Raje told reporters in Rawatsar after making the announcement.

The announcement comes at a crucial time when the state is gearing up for the upcoming assembly elections. Fuel prices across the country have been on a continuous rise crossing Rs 80 mark in Delhi a day ago, retailing at Rs 80.50 a litre while that in Mumbai at Rs 87.89 per litre.

To protest against the spiralling fuel prices, opposition parties have called for a ‘Bharat Bandh' on Monday. The surge in rates has renewed calls for a cut in excise duty but Finance Minister Arun Jaitley has remained non-committal, saying international oil prices are volatile.

An immediate reduction of central excise duty and excessive VAT in the states, bringing petrol and diesel under the ambit of GST are amongst some of the demands of the Opposition. Since mid-august, the petrol price has risen by Rs 3.24 a litre and diesel by Rs 3.74 per litre as Rupee hit a record low against the US dollar, making imports costlier.