(a) Whether the Government has withgrawn customs and excise duty cuts on various products since the middle of August 2004;
(b) if so, the details in thi regard;
(c) the revenue lost by the Government thereby; and
(d) the other steps taken by the Government to check rising inflation?
MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI S.S.PALANIMANICKAM)
a) Since the middle of August 2004, Government had reduced
the customs duties and excise duties on various
petroleum products, plastic raw materials and steel.
However, Government has not withdrawn any customs or
excise duty cuts on these products since the middle of
August 2004.
(b) Does not arise in view of (a) above.
(c) Since the duty cut has not been withdrawn, there is no
fresh revenue effect.
(d) To check rising inflation, Government had reduced the
customs duties and excise duties on various petroleum
products, plastic raw materials and steel. In addition,
certain other measures were also taken. These include,
(1) To check the liquidity overhang in the system, the
Reserve Bank of India (RBI), hiked the cash reserve
ratio (CRR), to be maintained by banks, by 50 basis
points to 5% of their demand and time liabilities.
(2) The Government cut tariff values on many vegetable
oils by around $50 a metric ton.
(3) The RBI hiked the reverse repo rate (that is, the
interest rate paid on bank funds placed with the RBI
against government paper) by 25 basis points to 4.75%