UP hikes petrol price by Rs 2/L, diesel by Rs 1/L to garner Rs 2,070 cr

The Uttar Pradesh government on Wednesday decided to increase the price of petrol by Rs 2 per litre and of diesel by Rs 1 per litre to raise additional revenue of Rs 2,070 crore amid the coronavirus pandemic, a state minister said.

Petrol will cost Rs 73.91 per litre while diesel will be available at Rs 63.86 per litre in the state, finance minister Suresh Khanna told reporters after the Cabinet meeting here.

"The hiked prices will come into effect from midnight today," he said.

Chief Minister Yogi Adityanath presided over the meeting of the Cabinet, which was held here on Wednesday.

"Keeping the current situation in mind it was necessary that we gather additional resources. In this context an important decision was taken to hike prices of diesel and petrol since the petroleum products come under the state government and are outside the ambit of GST," Khanna said.

It was decided to hike the price of diesel by Rs 1 per litre and that of petrol by Rs 2 per litre, he added. At present, the price of petrol is Rs 71.91 per litre and diesel is priced at Rs 62.86 per litre.

Petrol consumption is 470 crore litres and that of diesel is over 1,100 crore litres, Khanna said and added that the hike will generate additional revenue of Rs 2,070 crore for the state government.

The move follows the Centre's decision on Tuesday to increase excise duty on petrol by a record Rs 10 per litre and Rs 13 per litre for diesel. The hike, however, did not push up fuel prices as global oil prices have dropped to a nearly two-decade low.

The cash-strapped government will gain close to Rs 1.6 lakh crore in additional revenues this fiscal from a record increase in excise duty on petrol and diesel.