Our Bureau

New Delhi, Sept. 23

THE Petroleum Minister, Mr Mani Shankar Aiyar, today said that the Government plans to review the order to regulate liquefied petroleum gas (LPG) distribution, as it has not been able to check diversion of subsidised fuel.

The Minister accepted that the move to regulate LPG had led to scarcity of the mass consumed cooking fuel in some parts of the country.

The Government had restricted the number of LPG cylinders per distributor and frozen issue of new cylinders in some areas.

"The order has not been effective in checking diversion and black marketing of subsidised LPG cylinders, which are meant only for domestic use and not for commercial use. We need to rethink. We are reconsidering the decision," he told presspersons on the sidelines of a function here where production-sharing contracts under the fifth round of New Exploration and Licensing Policy were signed.

"We had taken a conscious decision that we should restrict the number of refills available with the LPG distributor to the customer base in his area. The deliberate restriction was to ensure that demand of genuine domestic consumers is met and pilferage checked," he said.

However, the subsidised LPG was being diverted for use in commercial establishments, restaurants and for automobiles, the Minister added.

LPG for commercial use is priced at market rates, that is, at least Rs 100 per cylinder higher than the retail price of domestic LPG.

A ceiling of LPG connection based on the customer database has been set for every distributor and new connections are issued only if the present customer base is lower than the ceiling, he said.

(This article was published in the Business Line print edition dated September 24, 2005)
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