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The subsidy on Liquified Petroleum Gas or LPG should be limited, the Government sources said on Monday as they think only the most needy should be given subsidy. The Petroleum Ministry is reviewing the current LPG subsidy regime, the sources said while further adding that all the economic utilities should be viable.
“The consumption of fuel is 15-16 per cent higher than the pre-Covid levels. Fuel price above $70 a barrel is high for a country like India. Crude supply from OEC plus countries is not able to meet the domestic demand. We are in talks with OPEC plus countries to increase production,” the sources said.
It is to be noted that the petroleum subsidy stood at 9 per cent of the Budget Estimate (BE), or a little over ₹ 1,230 crore in the April-July period of FY22, down from over ₹ 16,000 crore, or 40 per cent of BE, the last fiscal. The subsidy is being provided mainly for customers in far-flung areas, industry sources had told BusinessLine in September.
Fuel prices
States and Centre should coordinate with each other to bring fuel prices at a reasonable level. Talking on the increasing petrol, diesel prices, the official said that the petroleum ministry is in constant talks with the Finance Ministry to decrease fuel prices.
“It is because of the higher taxes, that people have to shell out more for the fuel. It is a matter of concern and both States, Centre should coordinate with each other to sort it out,” the official said, requesting to be not quoted.
It is to be noted that both petrol, diesel prices hit their record high on Sunday. While the price of petrol in Delhi rose to its peak at ₹ 105.84 a litre and ₹ 111.77 per litre in Mumbai. In Mumbai, diesel is selling at ₹ 102.52 a litre; while in Delhi, it is being sold at ₹ 94.57 a litre. This was the fourth straight day of 35 paise per litre increase in petrol and diesel prices. Meanwhile, diesel is available at over ₹ 100 a litre in many parts of the country.
In addition, the sources also said that there is a need to extend the production and exploration area in the country so that the dependence on other countries could be reduced. 85 per cent of India’s energy requirement is met through imports and as the country will head towards becoming a $5 trillion economy, the energy consumption will increase.
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