A day after petroleum minister Dharmendra Pradhan told Parliament that his ministry has asked oil marketing companies to increase price of LPG cylinders by Rs 4 per month in order to end subsidy, sources in the ministry said the government stands committed and will continue to provide subsidy assistance to the needy and poor households. The government launched the Pradhan Mantri Ujjwala Yojana (PMUY) in May 2016 to provide LPG connections to the 5-crore women belonging to poor households. Till date, more than 2.5 crore connections have been installed under the scheme. In the last three years, the total number of households having LPG connections have remarkably increased from 14 crore in April 2014 to 21 crore in July 2017.
The LPG penetration has increased from 56% to 76% now. The government at the start of FY18 had estimated total subsidy, including kerosene for the fiscal, to be Rs 25,000 crore. OMCs also increase price of kerosene by 25 paise every fortnight. Another source added that it is the right time to provide subsidy only to the actual beneficiaries who could be identified through the SECC 2011 list. “There is a thought that the subsidy, at least to the PMUY beneficiaries, should not stopped,” said the source.
In June 2010, petrol prices were deregulated and linked to international markets. In October 2014, diesel prices followed suit. However, the Centre continues to modulate the prices of domestic LPG and PDS kerosene by way of subsidy support.