Petrol and Diesel Under GST: Union Minister for Petroleum and Natural Gas Hardeep Singh Puri has once again called upon to come to a consensus over bringing petrol and diesel under the Goods and Services Tax (GST).
Puri said this while delivering a lecture on “Strategy and Measures for Enhancing India’s Energy Security in the Coming Decade” at the Pune International Centre’s (PIC) 14th Foundation Day lecture on Friday, September 27.
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Singh said, as quoted by news agency ANI, “I have heard a suggestion to bring petrol and diesel under GST, now petrol and diesel under GST is something that I have been advocating for a long period of time. Now I am very sure that my senior colleague, the finance minister, has also spoken about bringing fuel under GST on several occasions.”
He further said in order to enhance the country’s energy security, India needs to focus on strategic petroleum reserves and prioritise exploration and production to reduce its heavy reliance on imported fuel.
The Union Minister highlighted that with a population of 1.4 billion and energy consumption projected to be three times the global average, India is positioned to be a key player in the global energy landscape.
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Over the next two decades, India is expected to contribute to 25 percent of the world’s increase in energy consumption, he noted.
Puri stressed that achieving this requires unanimous approval from all states and acknowledges the challenges in getting states on board, as petrol and diesel are significant revenue generators for them.
As liquor and energy are major revenue sources, the states are unlikely to agree to this move, he further pointed out. “To make this happen, the states need to initiate the process, and the central government is ready to cooperate,” he said.
Even as the Kerala High Court had suggested discussing this issue in the GST Council, the finance minister of Kerala didn’t agree, Puri highlighted.
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He also claimed alleged that the non-BJP states are not willing to forego the additional VAT. “The Kerala High Court, if I remember last year, had suggested that the GST council should take this up as in its agenda, and my recollection is that in a meeting in Allahabad, it came up in the meeting also , but as you know, the GST council works on the principle of consensus and unanimity and the state chief ministers have to agree. We are currently in the situation that BJP-ruled states have reduced their VAT, and non-BJP states are not even willing to forego the additional VAT, so I do not see that it is happening,” he added.
“The government’s clearance for the exploitation of one million square kilometres of sedimentary basin sends a positive signal to investors. He identified three primary challenges to energy security: availability, affordability, and the transition to renewable energy sources.” Puri said while reflecting on India’s long history in oil exploration, dating back to the discovery of crude oil in Assam’s Digboi in the 1880s.
The Union Minister further mentioned that while green hydrogen represents the fuel of the future, its success depends on local demand and production, and that technological advancements could help overcome associated cost challenges.
He also noted that there is no shortage of oil globally. However, the rising geopolitical tensions could lead to increased oil prices. He added that traditional oil cartels will have less influence as new energy sources emerge.
In his closing remarks, Dr Raghunath Mashelkar, President of PIC, reiterated the importance of reducing India’s fuel import bill and advancing renewable energy initiatives.
