Why are the petrol and diesel price going high?

Because of hike in taxes the prices are increasing day by day.The Modi government had increased petrol prices by Rs 10 and diesel by Rs 13. This increase came just two months after the government's decision to hike the petrol and diesel price by Rs 3.Middle class people switching to electric scooter they can't afford the hike of petrol and diesel many electric scooter company earning a good revenue because of hike in petrol and diesel price.

Petrol and diesel are recorded to be all time expensive since few months, crossing the 100-mark in several cities of India, including the national capital. This unexpected hike in price has heavied the pockets of common citizens, especially daily commuters. Countering to the questions hurled at them by opposition at this crisis, the central government assured that the burgeoning price of Petrol and Diesel is for greater good, all in interest of our country. They further explained that control of price of both the miraculous liquid is not in their hands. The foreign instability has led to this jump in price. While they had not been precise, let's break down the points to decode why the price of Petrol and Diesel is going up and up without any pause.

Practically talking, the global crude oil price is what mainly influences the regional price of Petrol and Diesel. As we know that the government uses Dynamic Pricing System to decide the price of the same, the price doesn't remain constant. On 16th June, 2017, the government introduced a scheme, in which instead of revising the petrol price after every 15 days, the price will be revised every single day, that's why we often come to hear that the diesel (or petrol) has gone up by 50 paises, etc. In India, almost 84% percent of petroleum products are imported from foreign lands. And as we saw above that price of global crude oil affects other regional price, it is consistently inflating high since few weeks.

Furthermore, the government also imposes taxes on the petroleum that adds to the price of Diesel and Petrol. Recently, the government has increased the central excise duty by INR 13/litre and INR 16/litre on petrol and diesel respectively. So, consequently we can say that the control of price partially lingers in the hands of Government. Only if they give relaxation in the taxes on petroleum goods, the price of Diesel and Petrol will go down.

With the increase in fuel prices, people are now criticising PM Modi on social media, saying he had failed on his promise of reducing rates. How can this be?

The govt of India has claimed that the hike was due to rise in global crude prices and fall in value of Indian Rupee against US Dollar.

But that is not the whole truth. A new report published by Transparency International (TI) states that crony capitalism- an illicit commercial interaction between business people and government officials- is responsible for this price hike.

The report states that the country's oil companies are not following the "Karmayogi Formula" because they are getting huge subsidies from the Government.

The Government helps Indian Oil, HPCL and Bharat Petroleum in exchange for their service to the state. Both companies have earned huge profits by giving concessions to all their customers.

Transparency International's findings are backed up by an RTI reply filed by an income tax official, who had asked for details of revenue earned by Indian Oil Corporation Ltd. Why were these profits being given to a public sector company?

By comparing the net profit of six large private corporate groups with that of Indian Oil, it was found that they made much more money than the latter.

Revenue earned by Indian Oil Corporation Ltd. in 2016-17 stood at Rs. 4,636 crore.

The income tax officer had asked the state-run oil company for details of its revenue, profit, net profit and cash flow after giving all subsidies to customers during the year 2015-16.

This was not done despite numerous RTI pleas being filed by an income tax official of an assessee who had earlier submitted a gross additional return of Rs 1,406 crore to evade taxes.

The RTI reply revealed that between 2014-15 and 2015-16, the revenue of the corporation was Rs 4,473 cr while its profit came to 1,920 crore or 31% more than this revenue.

However, the profit of six large corporates stood at Rs 5,978 crore. This means the profit of these corporates was 3% higher than that of Indian Oil.

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