State-run fuel retailers will revise petrol and diesel prices daily in five cities Chandigarh, Udaipur, Vizag, Puducherry and Jamshedpur from May 1 as a pilot run before a countrywide rollout to counter undercutting by private retailers.
Till the system is in place throughout the country, public sector retailers will continue with the practice of tweaking prices on the 15th and last day of each month in all other places.
Daily revision will take the sting out of price hikes as they would be in small doses sometimes could even go unnoticed.
But more than that, the move has the potential to set off a price war and bring real competition in a market 95% of which is controlled by public sector retailers.
Revising prices daily will give them a chance to match private companies who have been undercutting them in a free market in times of low oil prices.
Politically, a daily revision will help the government sidestep the political fallout of consumer ire.
Though, technically, oil companies are free to revise rates, it is common knowledge that they are "guided" by political considerations.
From India, Ahmadabad
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