Cut taxes on petrol, diesel: Industry

Tribune News Service

New Delhi, May 16

Industry body CII has backed raising of benchmark interest rates by RBI even as it supported a cut in taxes on petroleum products in order to tame inflation.

“I do believe we are now in an era of higher interest rates. This will help us in bringing down inflation, at least a part of that going forward,” said newly-elected CII president Sanjiv Bajaj.

He pinned his hopes on a good monsoon which should “put us in a better place” by the second half of the year. “The RBI has already started the cycle of taking interest rates up and we should expect interest rates to continue moving up in the coming year. We will expect from RBI a clear direction to how they are going to address interest rates. Hopefully in the next monetary policy review we should be able to hear from them something to that extent,” he said.

CII estimates India’s GDP growth to be in the band of 7.4-8.2%, depending upon global oil prices.

Bajaj said tailwinds that are supportive of growth in the short-term include government capex, private sector investment, PLI scheme push in various sectors and positive export momentum.

The government should immediately moderate taxes on fuel products, which constitute a large share of the retail pump prices of petrol and diesel. “The CII will encourage Centre and state governments to collaborate in reducing these duties,” he said.

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