Indian oil firms cut gas prices for the second time this month, following an 11 percent hike in May that sparked public protests.
State-run refineries announced the cuts would yesterday, reducing the cost of a liter of gas by 2.46 ($0.04) rupees to 67.78 ($1.19) per liter, reported Reuters. May's increase triggered public outcry and political backlash in a country suffering from high inflation, even though gas is only about 10 percent of India's total fuel consumption.
"It is a very good step for the auto industry. We need much more such steps to reduce the price differential between petrol and diesel," Society of Indian Automobile Manufacturers (SIAM) senior director Sugato Sen told PTI.
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India imports close to 80 percent of its oil and the import bill has risen dramatically because of high global prices and a plunging rupee, according to the New York Daily News. Refiners have complained that they have to incur massive revenue losses because of constraints on keeping their selling prices in line with international prices.
India's government deregulated gas prices in 2010 in an attempt to reduce the immense subsidies it pays to state-run refiners, reported Agence France-Presse. But it still holds significant influence when it comes to gas price changes and has complete control over heavily subsidized costs of diesel, cooking gas and kerosene, which are all used by India's poor.