The Indian government slashed the excise duty on petrol by ₹10 per litre and completely waived the tax on diesel on Friday. The aggressive tax cut is a direct domestic defense mechanism against the escalating 2026 U.S.-Israel-Iran war, which has choked off global energy supply chains through the Strait of Hormuz.
As the Middle East conflict pushes the Indian Rupee past a record ₹94 against the U.S. dollar, the Centre is moving to shield consumers from volatile global oil prices. Andhra Pradesh leaders quickly backed the move, signaling strong regional support for the emergency economic intervention.
A strategic buffer against global shockwaves
India imports nearly 90% of its crude oil. The sudden closure of the Strait of Hormuz created an immediate pricing crisis for oil marketing companies. To stabilize the domestic market, New Delhi paired the consumer tax cuts with a massive windfall tax on fuel exports.
The government also moved to stop panic buying. Officials confirmed India currently holds strategic oil reserves to last 60 days and enough LPG for a month.
Regional leaders rally behind the Centre
Andhra Pradesh Chief Minister N. Chandrababu Naidu praised the tax reduction. Posting on X on Friday, Naidu called it a timely intervention.
“The true strength of leadership is tested in difficult times,” Naidu said. He added that the cut shields citizens from global price volatility, noting, “India stands out by putting its people first.”
The true strength of leadership is proven in testing times, and as I always say, India is fortunate to have Hon'ble PM @narendramodi Ji at the helm, providing stability amid challenging global conditions.
The Union Government’s decision today to cut excise duty on petrol and… https://t.co/EchaO4ru05
— N Chandrababu Naidu (@ncbn) March 27, 2026
Deputy Chief Minister K. Pawan Kalyan also backed the decision. He specifically pointed to the West Asian conflict and said waiving the diesel duty entirely protects everyday consumers and transport sectors from spiraling costs.