New Delhi, March 27: The Union Government reduced the central excise duty on petrol and diesel by Rs 10 per litre on Friday, a move designed to shield the public from rising energy costs. This domestic relief arrived alongside a significant shift in trade policy, as the Ministry of Finance simultaneously withdrew tax rebates and duty exemptions for fuel exporters. Under the newly amended Central Excise Rules, 2017, the government imposed an export duty of Rs 21.50 per litre on diesel and Rs 29.50 per litre on aviation turbine fuel.
Union Finance Minister Nirmala Sitharaman stated that the decision follows the ongoing West Asia crisis. She affirmed that the primary goal is to maintain the availability of essential goods for the Indian public despite global volatility. The Finance Minister asserted that the administration has consistently worked to protect citizens from the unpredictable nature of supply chains and shifting international costs.
The Department of Revenue’s notification effectively ends the ability of exporters to claim refunds on excise duty or move goods without prior payment. These changes specifically target motor spirit, high-speed diesel, and aviation turbine fuel by inserting exclusion clauses into Rule 18 and Rule 19 of the existing excise framework. Dheeraj Sharma, Under-Secretary in the Tax Research Unit, signed the order which became active upon publication.
While the broader export market faces these new constraints, the government maintained existing arrangements for specific regional partners. State-owned oil firms exporting to Nepal, Bhutan, Bangladesh, and Sri Lanka remain exempt from the new restrictions. This carve-out suggests a commitment to preserving strategic energy ties with immediate neighbors while tightening the domestic supply chain.
