Will the price of the LPG cylinder reach 1000 in the coming time? What is the government’s view on increasing the cost of LPG cylinders so high? No such news has come to the fore. But an internal assessment of the government has revealed that consumers are ready to pay up to Rs 1000 for a cylinder.
According to information from the sources, nothing is clear about the government’s view is regarding LPG subsidy at the increased price. According to sources, the government can take two stances relating to LPG cylinders. First, either the government should supply cylinders without subsidy. Second, some selected consumers should also be given the benefit of the subsidy.
Nothing has been said clearly about giving subsidies. But the rule of Rs 10 lakh income will be kept in force, and some selected Ujjwala beneficiaries will benefit from the subsidy.
Is subsidy off or on?
It is to be noted here that in some places, the subsidy on LPG has been stopped for the last several months, and this rule is running from May 2020. This step was taken after crude oil and gas prices fell during the COVID epidemic in the international markets. Although the government has not entirely stopped the subsidy on LPG cylinders, this provision has been continued in the country’s far-flung areas.
In recent months, the benefit of subsidy on LPG cylinders was being given in selected districts of 15 provinces of the country. But now, this number has come down to 8 states, including union territories. These states/union territories include Ladakh, Lakshadweep, Andaman-Nicobar and some north-eastern states. The system of LPG subsidy has been kept running here.
Government spending so much on subsidy
If we look at the government’s expenditure on subsidy, during the financial year 2021, Rs 3,559 was spent under Direct Benefit Transfer, i.e. DBT. In the financial year 2020, this expenditure was Rs 24,468 crore. The DBT scheme was started in January 2015. The customers have to pay the total amount for the non-subsidized LPG cylinder while the government refunds the subsidy money to the consumer’s bank account. This refund is direct; hence the name of the scheme is DBTL.
On September 1, the government had increased the price of LPG cylinders by Rs 25. This increase was made on the domestic cylinder of 14.2 kg. With this increase, the cost of the cylinder in Delhi has gone up to Rs 884.50. The price of a 14.2 kg LPG cylinder in Mumbai is currently fixed at Rs 884.50 and in Chennai at Rs 900.50.
Will people cook with kerosene?
In the past, many such reports have come out in the media, in which it has been said that the worst effect of abolishing the LPG subsidy has been on the economic condition of the weaker sections. Many households in rural areas stopped using LPG cylinders and started cooking with kerosene or wood. The reason for this was that most people are not in a position to spend Rs 800 on the cylinder price. If the prices of LPG cylinders increase further, then the problems may become more serious.