Govt raises cap on number of cylinders to 9 from April

Come April 1, each household will get nine subsidised cooking gas cylinders for the next 12 months, against six earlier. Also, consumers will get a quota of five subsidised cylinders for the period September 2012-March 2013, against three earlier.

The Cabinet Committee on Political Affairs (CCPA), under the Chairmanship of the Prime Minister, took these decisions after obtaining a go-ahead from the Election Commission. This was required as elections have been announced in the three north-eastern States of Mizoram, Meghalaya and Tripura

Congress meet

The move comes ahead of Congress party’s ‘Chintan Shivir’ (brain-storming session) in Jaipur on January 18-19. It may be recalled that soon after the Government’s decision on capping the numbers of subsidised cylinders in September last year, UPA Chief Sonia Gandhi had asked all Congress-ruled States to raise the number to nine. Some States like Delhi had already announced this for the BPL category.

“I am happy to inform the CCPA has agreed to raise the cap on subsidised LPG to nine cylinders per household in a year from the existing six cylinders,” Petroleum Minister M. Veerappa Moily told reporters after the meeting here on Thursday. However, there was no proposal to increase the price of subsidised LPG cylinders, he added. At present, the price of subsidised domestic LPG is controlled by the Government. The oil marketing companies are selling these cylinders below the cost, resulting in under-recovery.

According to the Petroleum Ministry, the three Government-owned companies are incurring an under-recovery of Rs 490.50 a cylinder for the fortnight beginning January 16. It is estimated that total under-recovery will be around Rs 32,000 crore for 2012-13. It may be recalled that in September last year, the Government had restricted the number for subsidised LPG cylinders for each household to 6 cylinders (of 14.2 kg) a year.

The Government had then claimed that about 44 per cent of the total domestic LPG consumers, use six cylinders or less in a year.

Further, it had restricted the number of such cylinders for each household in the remaining part (September 2012-March 2013) of the current financial year to three.

Burden on Govt

Now, the consumers will get two more subsidised cylinders for the second half of the current fiscal. This increase will add a burden of Rs 9,300 crore on the Government in the form of subsidy. This has been done, as more and more consumers complained that the restriction was not justified.

(This article was published on January 17, 2013)
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