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Earlier, steel saw export tariff barriers raised. Then overseas shipments of oil products got slapped with a windfall tax. With global oil prices ruling high on account of the Ukraine war, exporters were deemed to be making “phenomenal profits" at a time the Centre’s coffers had taken a hit and policymakers wanted supplies retained for domestic use. If the immediate context is all that matters, then this argument is sound.
From a longer-term view the moves are hard to justify. They spell tax instability, stunning investors who rightly assumed they must bear business lows but can’t be denied highs and signalling that any private enterprise can be subject to sudden policy shifts. They also imply that our export thrust is conditional, and the extent of our integration with the world is variable. While a crisis can be cited for various moves, what the Centre sees as its flexibility of approach translates to the unreliability of commercial conditions. Strategy making gets stressed, and risk scenarios proliferate. Both hurt corporate competitiveness. The gains of such tweaks can’t outweigh the eventual costs imposed. Fiscal concerns should never result in such frequent intervention.