Dr. Vijay Kalantri urges Government to cut Petroleum Prices Amid falling Global Crude Rates

Amid falling global crude oil prices across geographies, Government of India should also consider reducing retail rates of petroleum products to give a fillip to domestic economy supplementing GST rate rationalization to boost economic growth, urged Dr. Vijay Kalantri, President All India Association of Industries (AIAI) and Chairman, World Trade Center, Mumbai.

Dr. Kalantari’s remarks came in the backdrop of Brent Crude Oil falling to the 4-month low of 63.21 $ per barrel while WTI dropped below 65 $ per barrel. As per the PPAC of Ministry of Oil and Gas, India imports nearly 88% of its crude oil demands through imports.

Speaking on behalf of industries and manufacturers, Dr. Kalantari insisted that government should aim to cut prices of petroleum products across the range including petrol, diesel, kerosene and aviation fuel by 20 Rs. to support Indian exporters dealing with high tariffs, particularly in the U.S. market. Further he cited benefit that lower petroleum prices will lead to in terms of inflation (Retail inflation is at 2.07% last month), logistics costs (Cost of logistics is 6% to GDP against global average of 2-3%), support to MSMEs and Manufacturers.

He further emphasised that lowered petroleum prices will lead to lower inflation which will give headroom to the Central Bank to reduce repo rates by 50-100 basis points leading to lowered costs of borrowing, spurring credit and supporting growth.