According to the buying power of currencies in their native market, the price of LPG in India is the world's highest per litre, the price of petrol is the third-highest, and diesel is eighth-most expensive.
Purchasing power vs nominal exchange
Price comparisons at the nominal exchange rate (the rate at which currencies are exchanged on the international market) conceal the reality that various currencies have varying purchasing power in their respective markets.
Furthermore, income levels vary so drastically among nations that a litre of fuel is only a fraction of an average Westerner's daily income, one-fourth of an average Indian's daily income, and more than the average daily income in Burundi. According to the IMF, the PPP or international dollar will average Rs 22.6 in 2022, rather than Rs 75.84 now.
All Mathematics Behind The Highest Price
Petrol costs Rs 120 a litre, which equates to $1.58 at the current nominal exchange rate of Rs 75.84 per dollar. However, a dollar in the American market might purchase a lot less than Rs 75.84 in India. In March, for example, the average price of a kilo of potato in the United States was $1.94.
At the nominal exchange rate, this converts into Rs 147, which could purchase more than 7 kg of potatoes in India in March.
When converted to international dollars, the equivalent price of fuel in India is 5.2 international dollars per litre, the world's third-highest behind Sudan (Int $8) and Laos (Int $5.6).
LPG price in India is the world's highest, at Int $3.5 a litre. India is followed by Turkey, Fiji, Moldova, and Ukraine. LPG costs roughly Int $1 per litre in Switzerland, France, Canada, and the United Kingdom. India has the world's seventh highest diesel price, at Int $4.6.
