Reliance Industries, the country's largest LPG producer, will be spared from footing the Rs 7,200 crore (Rs 72 billion) bill for the one year freeze in LPG and kerosene prices, despite rising cost.
The ministry of petroleum and natural gas is evaluating a threshold at which the subsidy on liquefied petroleum gas (LPG or cooking gas) will be reinstated. According to a senior government official in the know, a survey is currently being conducted to determine the price at which maximum consumers will keep buying domestic cylinders. One of the options also being considered is to limit any subsidy disbursal only to Pradhan Mantri Ujjwala Yojana (PMUY) beneficiaries.
Prime Minister Narendra Modi on Friday announced a Rs 100 per cylinder cut in cooking gas LPG price to ease financial burden on households. Non-subsidised cooking gas price will be cut to Rs 803 per 14.2-kg cylinder in the national capital with effect from midnight of Friday/Saturday, official sources said. Prices vary from state to state depending on the incidence on local taxes.
Rs 7,024 cr transferred under LPG cash subsidy scheme.
LPG alone will save us Rs 8,000 cr a year: M Veerappa Moily.
The government has set up a committee to work out sharing by producers and retailers the losses likely to accrue from the decision to freeze LPG and kerosene price for a year despite rising cost.\n\n\n\n
The scheme was to be rolled out in 20 districts initially but the launch in Mysore in Karnataka and Mandi in Himachal Pradesh has been put off by a month due to assembly and Parliamentary bypolls, official sources said.
Currently, oil companies sell kerosene at a loss of about Rs 18 per litre.
India's largest oil producer Oil and Natural Gas Corp, gas utility GAIL and exploration firm Oil India Ltd will pay Rs 3,246 crore (Rs 32.46 billion) to oil marketing firms to partly cover the losses they made in April-June.
The government appointed panel will look at the difficulties consumers faced in receiving the subsidy after buying gas cylinders at market rates.
India may have to lean more on West Asian nations for supplies of liquefied petroleum gas (LPG), a cooking fuel, in the coming years after Indian state-run refiners drew up big plans to diversify into producing more profitable petrochemicals. This shift leads to reduced LPG output, Indian refining executives said. The mantra for state-run oil companies, from Indian Oil Corporation (IndianOil) to liquefied natural gas (LNG) importer Petronet LNG, which are looking to diversify their businesses from lower-margin fuels, has been value-added petrochemicals.
The government on Tuesday announced a Rs 200 per cylinder cut in prices of domestic cooking gas as it looked to counter the cheaper LPG promise of the Congress in upcoming assembly elections in states like Madhya Pradesh.
The government had last year excluded those with an annual income of more than Rs 10 lakh from LPG subsidy
To cut subsidy bill and reduce fiscal deficit, the previous United Progressive Alliance government had restricted the number of subsidised domestic cylinders per household to six every year in September 2012, revising it to nine the following January
'Individual beneficiary desirous of availing the benefits under the scheme (PMUY) is hereby required to furnish proof of possession of Aadhaar number or undergo Aadhaar authentication,' said a gazette notification issued by the ministry of petroleum and natural gas.
Only Rs 3,000 cr has been disbursed. Over 80% of these transfers were for cooking gas subsidy.
Hazra, the director of Hindustan Aegis LPG Bottling, said that the government's stance was discouraging the multinationals from making further investments.
The scheme will cost the state exchequer altogether Rs 1,650 crore.
Finance Minister Nirmala Sitharaman cut fuel subsidies while slapping additional fuel taxes on unblended transport fuels in the latest Union Budget. The former will hit the rural poor, households that secured a subsidised LPG connection under the Pradhan Mantri Ujjwala Yojana (PMUY), a programme that was partly instrumental in helping the Bharatiya Janata Party (BJP) win the 2019 general elections. The latter will pretty much hurt the entire population after it kicks in from October. That's what it looks like. Or, perhaps, it's not as it appears to be, at least on the subsidy front.
The government has asked the rich to give up subsidies on LPG to make them available to people who deserve it.
Experts say having an open fire in the kitchen is like burning 400 cigarettes an hour.
The government will phase out subsidies on LPG and kerosene by March 2007, Minister of State for Petroleum and Natural Gas Sumitra Mahajan said in a written reply to the Rajya Sabha on Tuesday.\n\n\n\n
LPG price was increased to Rs 858.50 per 14.2 kg cylinder from Rs 714 previously, according to a price notification from State-owned oil firms. This is the steepest hike in rates since January 2014, when prices had gone up by Rs 220 per cylinder to Rs 1,241.
India, the world's third largest oil importing and consuming nation, is likely to save as much as Rs 1.8 lakh crore on import of crude oil and LNG if the trend of softening international energy rates continues, Icra said Wednesday. India, which meets over 85 per cent of its crude oil needs through imports, spent $242.4 billion on buying crude from overseas in the fiscal year ended March 31, 2025.
Experts say the state's economy is grappling with hidden debt, rising welfare costs, and lack of transparency.
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 Direct Benefit Transfer for LPG scheme was rolled out in 291 districts from June 1, 2013 in six phases to do away with the practice of selling the fuel at below cost rates.
A CNN-IBN Urban India Ooinion Poll shows the recent economic reform move of the government has not gone down well with the urban India. The poll shows that while the price rise and corruption remain the major concerns for the urban India, there is also a massive anger over cap on LPG subsidy and diesel price hike among the people across the cities.
Prime minister's office wants OMCs to bear credit subsidy for remaining 8 subsidised units on reimbursement basis.
The Kelkar Committee has recommended sharp reduction in subsidies on petroleum, food and fertiliser, which the government said was contrary to its policy of protecting the poor.
Domestic cooking gas consumers in Delhi and Mumbai will from Wednesday get cash subsidy for buying cooking gas refils as the Direct Benefit Transfer for LPG (DBTL) Scheme will be extended to 105 more districts.
The cost of paying the subsidy in cash has increased the money spent by the government.
The government will phase out subsidies on LPG and kerosene by 2007, petroleum secretary S C Tripathi said on Friday.
Minutes after the Union Cabinet approved raising the cap on subsidised liquefied petroleum gas (LPG) cylinders from nine to 12 per connection in a year, Reserve Bank of India (RBI) Governor Raghuram Rajan questioned the decision, suggesting it was "misdirected subsidy".
Congress general secretary (communications) Jairam Ramesh said three months before the five state elections, where the 'BJP is staring at certain defeat', and six months before the Lok Sabha elections, the BJP is literally clutching at straws.
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