Oiling the recovery

Private players struggle against excessive regulation. The result is loss of investment and employment opportunities in India

As petrol prices touch Rs 100 per litre the government may face the choice of either cutting fuel taxes or letting inflationary pressures build. The steady rise in international oil prices as global economic recovery gets underway adds to the dilemma, as petrol/diesel taxes are estimated to have increased about 90 per cent since 2015 and become the source of a quarter of all indirect tax revenues. Meanwhile, domestic oil production has continued to decline, hemmed in by tax and cess and the inability of government to resolve legal and bureaucratic bottlenecks.

At their Monitoring Committee meeting on February 2, OPEC