Government limits LPG subsidy to Ujjwala beneficiaries

PTI

New Delhi, June 2

The government has limited subsidy on cooking gas (LPG) for only 9 crore poor women and other beneficiaries who got free connections under the Ujjwala scheme and the remaining users, including households, will pay the market price.

Oil Secretary Pankaj Jain at a news conference said no subsidy is paid on cooking gas since June 2020 and the only subsidy that is provided is the one that Finance Minister Nirmala Sitharaman announced on March 21.

Rs 6,100-cr burden on exchequer

• 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
• A 14.2-kg LPG cylinder costs Rs 1,003 in the national capital. Pradhan Mantri Ujjwala Yojana beneficiaries will get subsidy directly in their bank account

“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,” he said.

Sitharaman had while announcing a cut in excise duty on petrol by a record Rs 8 per litre and that on diesel by Rs 6, 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 the national capital. 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 Delhi. The Rs 200 subsidy will cost the government Rs 6,100 crore, she had said.

"Subsidies by definition are not designed to get entrenched and increased. Subsidies by definition have to be degressive," Oil Minister Hardeep Singh Puri said at the same conference. The government ended subsidies on petrol in June 2010 and on diesel in November 2014.