The government is considering a plan to reduce taxes applied to gasoline prices in addition to reducing import taxes on high-value items such as cooking oil and wheat.
A report by Bloomberg News, citing people familiar with the matter, suggests that government officials are considering a plan to reallocate up to Rs 10,000 from the budgets of different ministries to prevent prices from rising. food and fuel increased.
The report comes days after Prime Minister Narendra Modi pledged to curb rising inflation in the country during his Independence Day speech.
Prime Minister Narendra Modi will make a decision on budget reallocation in the next few weeks and the measures could include fuel tax relief and easing import duties on cooking oil and wheat, according to people briefed on the matter. cited in the report.
Inflation has been a persistent problem in India since 2022, with only a few months of remission from February to June this year. If the government chooses new measures to combat inflation, this will be the second year in a row that adjustments are needed to combat inflation. It can be noted that the government spent an additional Rs 2 lakh last year to protect consumers from rising inflation.
It's not just fuel prices, but households are feeling the heat of inflation everywhere - whether it's tomatoes, other fruits, and vegetables, milk, or even essential grains. like rice and wheat. All these factors pushed retail price inflation in India to a 15-month high of 7.4% in July.
Analysts and even the Reserve Bank of India (RBI) predict inflation will remain high in August, after which the trajectory will depend on developments in weather conditions. Rising inflation could pose a major challenge to the BJP-led NDA government, which faces several key parliamentary elections ahead of a key general election in 2024.
If inflation even spirals out of control, it could seriously harm the poorest, who have always supported the ruling party's focus on social projects and rural development.
