Petrol export duty cut to nil, diesel levy raised by ₹3 a litre

In the latest fortnightly review of fuel taxes, the Ministry of Finance announced that the export duty on petrol has been set to zero, effectively eliminating the charge that exporters previously paid on each litre shipped abroad. At the same time, the levy on diesel exports was raised from eight and a half rupees to eleven and a half rupees per litre, and the duty on aviation turbine fuel increased from ten and a half rupees to eleven rupees per litre. These adjustments are part of a broader effort to manage domestic fuel supply and generate additional revenue amid fluctuating global oil prices.

Data from the market intelligence firm Kpler indicates that diesel exports in October reached 700 kilo barrels per day, the highest volume recorded since September 2025. The surge reflects strong demand from neighbouring countries and a strategic push by Indian refiners to capitalise on favourable price differentials. While the higher export levy may slightly reduce profit margins for exporters, the government expects the increased revenue to offset any short‑term slowdown in export volumes. Analysts suggest that the move could also help stabilise domestic diesel prices by discouraging excessive outflows.

The revised tax structure arrives at a time when fuel prices remain a sensitive political issue across the country. By cutting the petrol export duty, the government aims to keep domestic gasoline supplies ample and potentially lower retail rates for consumers. Conversely, the higher diesel levy may translate into modest price adjustments for transport operators and industries that rely heavily on diesel fuel. Observers will be watching how these changes affect the balance between export earnings and domestic affordability in the coming quarters.