While Diesel is costlier than gasoline or petrol in European countries and North America, it is cheaper in India. In other words, petrol is costlier than Diesel in India. Why this difference?
Well, the answer to this lies in the unique pattern adopted by the India government in pricing petroleum products. In fact, this dates back to the immediate years since India's independence. Then a nascent economy with more problems than pluses, the government, realizing that farmers, trucks, and local bus fleets depend more on Diesel and petrol is used mostly by motorcycles and cars (then symbols of luxury), decided to structure the pricing accordingly so that lesser burden falls on the poor sections of the society. As a result, Diesel was priced lesser and the deduction in its price was subsequently added to the price of petrol.
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