Govt weighs LPG subsidy for oil marketing companies as losses mount

As cooking gas underrecoveries soar, Centre considers ~40K cr mid-year payout

India’s favourite cooking fuel may burn better, as the Narendra Modi government is seriously considering a one-time subsidy for oil-marketing companies (OMCs) in the coming months to offset part of the mounting losses on fuel sales, sources privy to internal discussions said. 

The central government, which did not allocate funds for record underrecoveries in this financial year’s Budget presented on February 1, may reimburse a sizeable portion of the estimated Rs 40,000 crore in losses incurred on liquefied petroleum gas (LPG), said two sources who participated in high-level discussions this year. 

Market sources privy to the discussions expect the government