Mumbai / New Delhi: The oil ministry and its roads, transport and highways counterpart are opposed to the cess on petrol and diesel being increased to fund the national highway programme, according to people familiar with the situation.
Move blocked: Kamal Nath had favoured the oil cess. Harikrishna Katragadda / Mint
Recent reports have suggested that the oil cess may be increased by Re1 per litre for petrol and diesel in next month’s budget.
Expectations of an increase in the oil cess, which currently stands at Rs2 per litre, were fanned by Union minister of roads, transport and highways Kamal Nath saying that such a move would help his ministry achieve the ambitious target of constructing 20km of highways every day across the country.
Oil ministry officials, who didn’t want to be named, said there was no formal move to increase the cess at this stage, adding that the ministry would oppose any such proposal.
In fact, the oil ministry wants the government to step in and help bleeding oil marketing companies by increasing the retail price of fuels or even by cutting the excise duty on petroleum products.
Officials in the ministry of roads, transport and highways, who also didn’t want to be named, confirmed that no proposal had been sent to the oil ministry for increasing the cess.
The officials added that the ministry would not push for an increase either as it is well funded.