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Rediff News  All News  » Business » CCEA may clear raising LPG cylinder cap at next meeting

CCEA may clear raising LPG cylinder cap at next meeting

January 24, 2014 16:45 IST

The Cabinet Committee on Economic Affairs may raise the subsidised LPG cylinder quota from 9 to 12 at the next meeting, Petroleum Minister M Veerappa Moily said.

"The Cabinet note on the proposal of increasing the number of subsidised cooking gas cylinders per household annually was circulated last week, and may be cleared in the next meeting," he said.

Congress Vice President Rahul Gandhi last week asked the government to raise the number of subsidised cylinders that households get in a year.

Increasing the limit to 12 would result in additional fuel subsidy burden of Rs 3,300 crore-Rs 4,000 crore (Rs 30-40 billion). The government already incurs about Rs 46,000 crore per annum as LPG subsidy.

The government had initially capped the supply of subsidised domestic LPG cylinders to six per household in September 2012 in a bid to cut its subsidy bill. It was raised to nine in January 2013.

Consumers who exhaust their quota have to buy LPG at the market price of Rs 1,258 per cylinder. Subsidised LPG costs Rs 414 per cylinder in Delhi.

At present, 89.2 per cent of the 15 crore LPG consumers use up to nine cylinders, weighing 14.2 kg each, in a year and only 10 per cent have to buy the additional requirement at the market price.

After the quota is raised to 12, about 97 per cent of the LPG consumers would be covered by subsidised LPG (Liquified Petroleum Gas).


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