New Delhi: Prime Minister Narendra Modi-led government has limited the subsidy on cooking gas LPG for only nine crore poor women and other beneficiaries, who got free connections under the Ujjwala scheme.
The remaining users, including households, will, however, pay the market price.
Union Petroleum Secretary Pankaj Jain said no subsidy is paid on cooking gas since June 2020, adding the only subsidy that is provided is the one that Finance Minister Nirmala Sitharaman announced on March 21, PTI reported.
“There was no subsidy for LPG users since the early days of Covid. Since then the only subsidy is one which had been introduced now for Ujjwala beneficiaries,” the news agency quoted Jain as saying.
Announcing a cut in excise duty on petrol by a record Rs 8 per litre and that on diesel by Rs 6, the Finance Minister had stated that Ujjwala scheme beneficiaries will get Rs 200 per cylinder subsidy for 12 bottles in a year to help ease some of the burden arising from cooking gas rates rising to record levels.
A 14.2-kg LPG cylinder costs Rs 1,003 in Delhi.
The Pradhan Mantri Ujjwala Yojana beneficiaries will get Rs 200 subsidy directly in their bank account and the effective price for them would be Rs 803 per 14.2-kg cylinder. For the rest, it will cost Rs 1,003 in the national capital.
Sitharaman had said the Rs 200 subsidy will cost the ruling dispensation Rs 6,100 crore.
Speaking at the same conference, Union Petroleum and Natural Gas Minister Hardeep Singh Puri had said the “subsidies by definition are not designed to get entrenched and increased”.
“Subsidies by definition have to be degressive,” he added.
The country has nearly 30.5 crore LPG connections. Of this, nine crore have been provided under the PM Ujjwala Yojana.
Puri said the rates of “LPG for domestic consumers have gone up by just 7 per cent in last 6 months whereas the Saudi CP (the benchmark used to price LPG) has gone up by 43 percent”, adding “this is the reality”.
Non-subsidised or market priced LPG, which most users other than Ujjwala pay, have gone up by Rs 103.50 per 14.2-kg cylinder since October 2021 and by almost Rs 200 in one year.
A 14.2-kg LPG cylinder was priced at Rs 809 in June 2021. Its prices were raised by about Rs 90 in the next four months.
The prices were hiked by Rs 50 per cylinder in March and then again in May the rates went up by Rs 3.50.
Referring to the rise in rates in Saudi CP and the ones in India, Puri said: “We have been, thanks to sound policies, insulating our users from the tremors in the international market and the turmoil.”
The Union Minister also refuted reports of a drop in the purchase of refills by Ujjwala beneficiaries once they exhaust their first cylinder post getting free connections.
“It is completely untrue,” Puri said.