Fuel price hike: Sitharaman says ‘India can’t afford fear mongering’; govt may lose Rs 1 lakh crore revenue

Union finance minister Nirmala Sitharaman on Monday said that reducing excise duties on petrol and diesel would lead to a revenue loss of around Rs 1 lakh crore. She also stressed the need to give confidence to people and that “India cannot afford fear mongering.”Her remarks came as fuel prices saw a fresh round of hikes, marking the fourth increase in 10 days. On Monday, petrol became costlier by Rs 2.61 per litre and diesel by Rs 2.71 per litre, adding further pressure on household budgets and transport costs.Speaking at the 37th anniversary event of the Small Industries Development Bank of India (SIDBI), Sitharaman criticised what she described as a growing “pessimistic narrative” being pushed by naysayers following Prime Minister Narendra Modi’s appeals on altruism. She said the country “cannot afford fearmongering” and emphasised the need to build confidence among citizens through both words and actions.

Focus on ‘3 Fs’

As the Middle East crisis approaches the three-month mark, the FM urged to focus on the “three Fs,” fuel, fertiliser and forex, while asserting that India’s economy remains resilient despite global uncertainty. Finance minister Sitharaman also pointed to rising global pressures, noting that fertiliser prices have reached “unimaginable” levels, while elevated gold prices are creating “some challenges” on the external front.She further added that the move aligns with Prime Minister Narendra Modi’s broader approach to managing external shocks. At the same time, she also dismissed exaggerated negativity, saying that some “naysayers” were portraying the situation as if everything is “crumbling”, which, she stressed, was not the case.“All the good that is being done by the common people themselves, that is forgotten. And a pessimistic, cynical narrative is generated, which is just not right,” she said. “We should appreciate that the challenges are more externally driven. We must also recognise that India’s domestic economic situation remains positive and resilient even today,” she added. “India cannot afford fearmongering. We need to give confidence to the people with our words and with our actions,” she said, adding that a section of people is attempting to decry “our own achievements amid the challenges posed by the West Asia crisis”.

Finance minister highlights MSME concerns

Minister Sitharaman also raised concerns over Rs 8.1 lakh crore locked in delayed payments to MSMEs, saying it is affecting working capital and growth. She urged public sector undertakings to ensure payments are made within the 45-day timeline for MSMEs.Ahead of the recent price hikes, the government had revised its fuel duty structure, lowering the special additional excise duty on petrol to Rs 3 per litre and removing it entirely on diesel. The move comes amid ongoing disruptions in global oil supply chains due to the conflict in the Middle East, with tensions around the Strait of Hormuz affecting energy flows.Since the Middle East conflict began on February 28, energy supplies through the crucial Strait of Hormuz have remained disrupted, sending ripples across the globe.