Cornered, Centre looks at raising subsidised LPG cap

Written by feBureau | New Delhi | Updated: Nov 24 2012, 08:40am hrs
The government is looking to increase the number of subsidised domestic LPG cylinders from six per household. In reply to a question in Parliament, petroleum minister M Veerappa Moily said, Representations have been received to revise the annual cap, which is being looked into.

On September 13, the government decided to limit the supply of subsidised domestic cooking gas weighing 14.2 kg to six per consumer per annum (currently R410 a cylinder in the capital). From the seventh cylinder onwards, the consumer would have to pay the market rate (R900 per cylinder). There are, however, no limits on the number of domestic non-subsidised cylinders that customers can avail beyond the three subsidised refills.

With strong protest from various corners, the government is mulling to revise the cap on the number of subsidised cylinders. Despite the recent hike in diesel prices and the cap on domestic cynlinders, state-owned oil marketing companies (OMCs) are expected incur total underrecoveries of R1,63,000 crore this fiscal as compared to R1,38,500 crore last year. At present, there are around 14 crore domestic LPG customers. About 1.2 crore customers were added in 2011-12, indicating growth of around 10%.