New Delhi, Jan. 2: The Narendra Modi government today raised the excise duty on petrol and diesel - the seventh duty increase since November 2014 - to raise around Rs 4,400 crore to shore up its revenues.

While excise duty on petrol has been raised by 37 paise per litre, the hike for diesel is Rs 2 a litre.

However, there will be no increase in retail selling price of petrol and diesel as state-owned oil firms had not passed on the full benefit of a reduction in international oil prices to consumers on January 1.

The basic excise duty on unbranded or normal petrol has been increased from Rs 7.36 per litre to Rs 7.73 and the same on unbranded diesel from Rs 5.83 to Rs 7.83 per litre, a notification of the Central Board of Excise and Customs (CBEC) said.

The increase in excise duty will fetch the government over Rs 4,300 crore on diesel and about Rs 80 crore on petrol.

This is the second time in less than three weeks that excise duty is being raised to make use of the slump in crude oil prices to garner resources for the government.

On December 16, the government had raised excise duty on petrol by 30 paise per litre and Rs 1.17 a litre on diesel to garner Rs 2,500 crore.

Taken together with the November 7, 2015 increase in excise duty on petrol of Rs 1.60 per litre and diesel by 30 paise that fetched Rs 3,200 crore to the exchequer, this is the third hike in fuel levies this fiscal.

In the three increases, the government is expected to mop up over Rs 10,000 crore to meet its budgetary deficit.

The increase in fuel duties comes at a time when the government faces the challenge of meeting the fiscal deficit target of Rs 5.55 lakh crore for the whole year.

Opposition parties had attacked the decision of the government to frequently hike the duty on petrol and diesel and dubbed it as "profiteering" from the fall in global crude prices, which, at present, is ruling around $33.36 a barrel for the Indian basket.

However, finance minister Arun Jaitley had earlier defended the government decision by stating that the money was needed for development work.

Prior to the increases in the current financial year, the government had, in four instalments, raised excise duty on petrol and diesel between November 2014 and January 2015.

The four excise duty hikes during that period totalled Rs 7.73 per litre on petrol and Rs 6.50 a litre on diesel. It led to about Rs 22,000 crore in additional revenues to the government, helping it meet its fiscal deficit target.

If the government would not have raised these duties, consumer price of petrol and diesel should have been lower by Rs 10.02 a litre and Rs 9.97 per litre respectively.

At present petrol costs Rs 65.12 per litre in Calcutta while diesel costs Rs 48.80 a litre.