There has been a clamour for an excise duty cut owing to rising fuel prices and depreciating rupee
The government will stick to its fiscal deficit target of 3.3 percent of gross domestic product (GDP) for the current financial year 2018-19, a top government official said today.
There has been a clamour for an excise duty cut owing to rising fuel prices and depreciating rupee.
However, cutting excise duty at this point in time may lead to a situation of "twin deficit" - - current account and fiscal deficit, the official said.
Even a rupee's cut in excise duty on petrol and diesel is expected to hit Centre's revenue by nearly Rs 30,000 crore.
Rising oil prices continue to remain as petrol price in Mumbai crossed Rs 88.35 per litre and diesel at Rs 77.55 per litre. It touched Rs 80.96 per litre for petrol in Delhi and Rs 73.06 per litre for diesel.
Current account deficit widened to 2.4 percent of GDP in April-June quarter as against 1.9 percent in the quarter ended March 2018. The deficit widened mainly on account of higher trade deficit led by weakening of domestic currency.
Earlier in the day, rupee plunged to a record low of Rs 72.91 against the dollar but recovered around to close at Rs 72.19.While the government said that the current macro-economic scenario is not "alarming" sources said that Prime Minister Narendra Modi is expected to make an announcement on oil and rupee situation after a review meeting on Saturday.