India imposes export duty on diesel, aviation fuel to discourage overseas shipment
The decision came on a day when the government also announced a cut in excise duty on petrol by Rs3 from the existing rate, citing volatility in the global energy market.
India on Friday (27 March) said it has introduced an export levy on diesel and aviation turbine fuel (ATF) to discourage overseas shipment and ensure domestic availability amid a sharp rise in global fuel prices linked to the escalating Middle East conflict.
Petroleum and Natural Gas Minister Hardeep Singh Puri said the government has imposed the export duty at a time when international diesel prices have surged sharply.
"The government has simultaneously introduced an export levy on diesel. At a time when international diesel prices have surged sharply, the levy is designed to disincentivize exports and ensure that refinery output is directed first towards meeting domestic demand," he said in a statement.
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"Keeping Indian pumps fully supplied takes precedence over export opportunities, however commercially attractive those may be at current global prices," the minister added.
External Affairs Minister S Jaishankar also said in a post on the social media platform X that export duties have been imposed at Rs21.5 per litre on diesel and Rs29.5 per litre on aviation turbine fuel to ensure adequate domestic supply.
India is the world's fifth-largest exporter of petroleum products, supplying refined fuel to more than 150 countries, according to the Ministry of Petroleum and Natural Gas.
The decision came on a day when the government also announced a cut in excise duty on petrol by Rs3 from the existing rate, citing volatility in the global energy market.
Hardeep Singh Puri said the move is consistent with the approach adopted during the Russia-Ukraine War, when the government reduced central taxes to shield consumers from rising fuel prices.
"The same principle governs today's intervention: India's citizens and industry should not bear the cost of disruptions they did not cause," he added.
According to Central Board of Indirect Taxes and Customs Chairman Vinay Chaturvedi, the export duty on diesel and ATF is expected to generate around Rs1,500 crore in revenue over a fortnight.
He also said the cut in excise duty on petrol and diesel would lead to a revenue loss of about Rs7,000 crore for the next 15 days.
The export duty on diesel and ATF was introduced in July 2022 following the Russia-Ukraine war and withdrawn in December 2024.
