Petrol export levy raised to ₹2.50 a litre, diesel levy cut to ₹8.50 in fortnightly review
The Union government has increased the export levy on petrol and reduced it on diesel in its latest fortnightly review, while leaving the levy on aviation turbine fuel (ATF) unchanged.
Under the revised rates, petrol exports will attract a levy of ₹2.50 per litre, up from ₹0.50 per litre fixed in the previous review. The levy on diesel exports has been brought down to ₹8.50 per litre from ₹16 per litre. ATF exports will continue to pay ₹10.50 per litre, as before.
The new rates apply for a 15-day period beginning October 16.
Crucially, there is no change in the duty on petrol, diesel or ATF meant for sale in the domestic market. The revision therefore does not alter what consumers pay at fuel stations.
An export levy is a tax charged on fuel that is shipped out of the country rather than sold within it. It is separate from the excise duty and the State-level taxes that apply to fuels sold domestically.
The government has been reviewing these levies every fortnight since March 27, in the backdrop of the conflict in West Asia. The rates are worked out on the basis of the average international benchmark prices of crude oil, petrol, diesel and ATF recorded since the previous review.
The stated aim of the levy is to keep sufficient fuel available in the domestic market. When export realisations are high, refiners may prefer to sell abroad; a levy narrows the gap between export and domestic earnings, discouraging that preference.
The context matters because India is among the world's largest exporters of refined petroleum products. Domestic refineries process imported crude and sell a substantial share of their output overseas, which is why refiners track these fortnightly revisions closely.
Volatility in international crude and product markets, linked to the conflict in West Asia, is the reason the government has chosen to review the levies at short intervals rather than fix them for longer periods. Because the mechanism is reviewed every two weeks, the rates can move sharply from one review to the next.
The latest revision follows that pattern: a steeper levy on one fuel and a lighter one on another, reflecting how benchmark prices for each product moved over the preceding fortnight.
For consumers, the immediate effect is confined to the export side of the business. Retail fuel prices are decided separately, and the government has said there is no change in the duties applicable to domestic sales.
The revised rates remain in force until the next fortnightly review.
