Government Takes Major Action On Middle East Crisis; Committee Formed Under Chairmanship Of Rajnath Singh

New Delhi: The government has constituted an Inter-Ministerial Group (IMG), chaired by Defence Minister Rajnath Singh, to monitor issues arising from the conflict in the Middle East. According to sources, Union Home Minister Amit Shah, Union Finance Minister Nirmala Sitharaman, and Union Petroleum Minister Hardeep Singh Puri are among the members, alongside other ministers.

What steps has the Centre taken?

On Friday morning, the government reduced the excise duty on petrol and diesel; consequently, the excise duty on petrol was lowered by ₹3 per liter, while the duty on diesel was brought down to zero. A windfall tax of ₹21.5 per liter has been fixed on the export of diesel.

Additionally, the government has revised the tax structure for Aviation Turbine Fuel (ATF). A new excise duty of ₹50 per liter has been introduced. However, due to exemptions, the effective duty will be capped at ₹29.5 per liter, thereby reducing the burden on the aviation sector.

The notification states that the ₹50 per liter levy on Aviation Turbine Fuel constitutes a Special Additional Excise Duty, accompanied by certain exemptions that limit the effective rate to ₹29.5 per liter. Further adjustments to the excise duty structure have also been implemented to help maintain overall stability in fuel prices.

Why is this initiative significant?

This reduction comes at a time when the world is facing an energy crisis triggered by the US-Israel conflict involving Iran, and the subsequent blockade imposed by Tehran on the Strait of Hormuz. The Strait of Hormuz serves as the conduit for one-fifth of the world's crude oil and gas supplies—amounting to between 20 and 25 million barrels per day. Prior to the outbreak of hostilities, India procured between 12 and 15 percent of that oil. Meanwhile, the Ministry of Petroleum and Natural Gas, in an official statement, gave assurances that all retail outlets across the country are functioning normally and that "ample stocks of petrol and diesel are available at all petrol pumps." It also urged the public not to engage in panic buying amidst the circulating rumors.