The Hindu Business Line : Launch of pilot scheme for PDS kerosene deferred to Oct

THE Government has deferred the launch of the pilot scheme to strengthen the distribution and marketing of kerosene under the public distribution system (PDS) to October 2. The launch was earlier scheduled for the first fortnight of August.

The decision to push back the launch was taken at a meeting convened by the Petroleum Minister, Mr Mani Shankar Aiyar, here recently.According to sources, the decision was based on a request by the oil marketing companies (OMCs). The OMCs wanted more time to put in place a foolproof distribution network and procurement facilities, in order avoid any future hurdles.

The scheme aims to ensure that the subsidised product is made available to the intended consumers and not diverted for unauthorised applications. It also sees synergy between the Petroleum Ministry and the Ministry of Panchayati Raj.

A pilot project has been approved by the Government to strengthen the distribution network of PDS kerosene in 10 per cent of the blocks. Under the scheme, oil marketing companies will use technology to transport kerosene to the actual storage point. The scheme will also involve the panchayats to ensure that those targeted benefit from the scheme. The Government provides a subsidy of more than Rs 13 per litre on the sale of PDS kerosene. Because of the wide difference in market and PDS prices, the intended beneficiaries have not been getting their supplies. The State-owned OMCs will initially create infrastructural facilities on a pilot basis in 10 per cent of the blocks in the country. Based on the experience of the scheme for six months, scaling it up to cover the entire country will be considered. The revamped PDS kerosene scheme will cost oil marketing companies Rs 500 crore.

Deliveries up to wholesale and sub-wholesale points will be under the Government OMCs to prevent kerosene diversion. At present, there are no dealerships in over half of the blocks in the country.

The Petroleum Ministry has already commissioned a study through the National Council for Applied and Economic Research (NCAER) to assess the genuine demand and requirement of kerosene. Further action to strengthen and streamline PDS kerosene supply will be taken on receipt of the NCAER's report, expected in August.

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