Union Home Minister Amit Shah on Thursday said the reduction in excise duty on petrol and diesel is a very sensitive decision by Prime Minister Narendra Modi, and it will not only bring relief to the common man but also reduce inflation.

The BJP-ruled state governments, under the leadership of Modi, have also done a commendable job of providing more relief to the people by further reducing the prices of petrol and diesel, he said.

"Prime Minister @narendramodi ji has given a big relief to the general public on Diwali by reducing the excise duty on petrol and diesel by Rs 5 and Rs 10 respectively.

"The relief given even after prices increased internationally is a very sensitive decision. I thank Modiji for this," Shah said in tweets in Hindi.

The home minister said this "Diwali gift" by the prime minister to the country would not only bring relief to the common man but also reduce inflation.

The Centre on Wednesday cut excise duty on petrol by Rs 5 per litre and that on diesel by Rs 10 a litre to give reprieve to consumers battered by record-high retail fuel prices.

Several BJP-ruled states and Bihar, where the BJP is part of the ruling coalition, also reduced VAT rates, giving further relief to consumers.