On Friday, Prime Minister Narendra Modi calls out a review meeting with Finance Minister Arun Jaitley and Petroleum Minister Dharmendra Pradhan in Delhi. The meeting was regarding the concern of rising fuel prices even after an excise cut on petrol and diesel last week.
According to the statement given by a senior official, “The PM’s meeting held in the morning was on the issues on the petroleum. The discussion involves around rising domestic oil production, total fund involve by oil marketing companies (OMCs) and lowering down the oil imports to cut down the current account deficit. The meeting was held because of the reason as the US permit against Iran kicks-in on November 4 and India is dependent on imports because of its more than 80 percent oil demand.”
Regarding the domestic oil production, Dharmendra Pradhan Petroleum Minister said on October 1 that Rs. 5,900 crore of investment had been devoted for the searching of 55 oil and gas blocks. The blocks are the one that were awarded in the first round of auctions under the country’s new Open Acreage Licensing Policy (OALP).
The OALP, under the new Hydrocarbon Exploration and Licensing Policy (HELP), gave permission to the investor to choose the blocks according to their preference and submit an expression of interest throughout the year. The HELP policy has swapped nine previous rounds held under the New Exploration Licensing Policy (NELP) wherein the government fixed out areas for bidding.
The central government has announced a decrease in the price of petrol and diesel by Rs. 2.50 a liter each On October 4. Hence it requested state governments to equal out the decrease to provide relief from high fuel prices.
The government has to bear the excise duty cut of Rs. 1.50 a liter totaling to about Rs. 10,500 crore for the rest of the fiscal period, it asked the OMCs to liquidate the 1 Re remaining.
Although, the cut in excise duty, which is expected to increase the fiscal deficit by 0.05 percentage points that the government was devoted fully to meet the fiscal deficit target of 3.3 percent.