Govt may amend Kerosene Order to check misuse

The petroleum ministry plans to amend a 1993 Order to prevent states from taking advantage of loopholes in the regulation of kerosene use.

The ministry has found that PDS kerosene is being sold at the market rate of Rs 27.60 per litre, which is more than double the subsidised rates.

The issue of states taking liberty in the regulated use of this fuel came to light when it was found that Tamil Nadu had allowed public-distribution-system kerosene to be used as a fuel for motorised fishing vessels.

This was done using a sub-section in the Kerosene (Restriction on Use and Fixation of Ceiling Price) Order, 1993, which restricts the use of PDS kerosene only for cooking and illumination purposes, but allows state governments to notify other purposes of the fuel.

"Diversion of PDS kerosene for motorised vehicles at the market rate is not in line with the government's existing policy. Subsidised kerosene meant for public distribution is being used by Tamil Nadu for making profits," sources said.

Apart from introducing an amendment, the ministry has also directed officials to find out how many states have been guilty of diverting PDS kerosene and selling it for profit.

Section 3 (1) of the 1993 Order states: "No person shall use kerosene under public distribution system for any purpose other than cooking and illumination provided that the central or state government may by order permit any person to use kerosene for such purposes as it may specify under the order".

Tamil Nadu issued an order under this provision to allow fishermen of Kancheepuram, Thoothukudi, Tiruneliveli and districts in Kanyakumari to use it for their motorised fishing vessels.

Experts have generally held that subsidisation of PDS kerosene encourages inefficient use of the product like for running motors that otherwise be run on petrol and diesel.