Centre orders LPG price to be hiked by Rs 4 per month

This, to eliminate all subsidies by March next year, said Oil Minister Dharmendra Pradhan

Oil marketing companies like Indian Oil Corporation (IOC), Hindustan Petroleum Corporation (HPCL) and Bharat Petroleum Corporation (BPCL) have started increasing the prices of cooking gas by Rs 4 per cylinder as part of the phase-wise decontrol of the fuel.

OMCs were authorised to increase price of subsidized domestic LPG cylinder by Rs 2 per cylinder (14.2 kg) per month with effect from July 1, 2016. “The government vide its order dated May 30, 2017 has again authorized OMCs to continue to increase the effective price of subsidized domestic LPG by Rs 4 per cylinder effective from June, 2017 per month till the reduction of Government subsidy to “NIL”, or till March 2018, or till further orders, whichever is earliest,” petroleum minister Dharmendra Pradhan said responding to a question in Lok Sabha. The price for the other subsidised cylinders like 5 kg would be increased proportionately by OMCs.

For the month of July, the subsidy amount on a 14.2 kg cylinder transferred to the accounts of Delhi consumers stood at Rs 86.54. The prices of subsidised LPG in Delhi stood at Rs 477.46 per cylinder in Delhi in the month of July, while non-subsidised prices stood at Rs 564.

This comes at a time when more below poverty line population are getting into LPG ambit through the Pradhan Mantri Ujjwala Yojana (PMUY), a flagship programme of Narendra Modi government.  The government had launched PMUY to provide five crores new LPG connections to the women belonging to the BPL families over a period of three years starting from the financial year 2016-17. Oil Marketing Companies (OMCs) have already released more than 2.5 crore connections under the scheme within a span of 14 months since the launch of the scheme on May 1, 2016, at Balia in Uttar Pradesh.

The government had also launched GiveItUp campaign giving the option for the consumers to give up the subsidy. Under this scheme, so far, more than one crore LPG consumers have given up their LPG subsidy. Interestingly, OMCs have reported an expenditure of nearly Rs 66 crore till March 2017 for popularising GiveItUp campaign. Meanwhile, OMCs have advertised 2843 locations to set up new LPG distributorships rural India.