LPG Price Increased 56 Percent In Last Four Years And Subsidy Also Reduced

LPG Price Hiked: Recently, on March 1, people in the country got a double blow of inflation when both the domestic and commercial price of LPG saw a steep rise. People had to face the onslaught of inflation even before Holi and the government has also faced criticism for this. All the opposition parties, including the Congress, attacked the central government, but no response has come from the government regarding this.

LPG price has increased by 56 percent

Recently, after an increase of Rs 50 in the price of 14.2 kg domestic Liquid Petroleum Gas (LPG) cylinder, the price of the cylinder reached Rs 1103. But statistics have shown that the prices of cylinders have increased by about 56 per cent in the last four years. The retail selling price (RSP) of domestic LPG cylinder (14.2 kg) was Rs 706.50 on April 1, 2019, which has increased to Rs 744 in 2020, Rs 809 in 2021 and Rs 949.50 in 2022. On March 1 this year, the price increased from Rs 1053 to Rs 1103 now.

substantial reduction in subsidies

While the price of domestic LPG cylinders has registered a significant increase in the last few years, government data shows that the total subsidy on LPG has come down significantly over the years. The details of subsidy on LPG given by the government in the last four years shows that it was Rs 37,209 crore in 2018-19 and has come down to Rs 24,172 crore in 2019-20, Rs 11,896 crore in 2020-21 and Rs 1811 crore in 2021-22. Crores remained.

The effect of increasing the prices of related products in the international market

According to information received from the Ministry of Petroleum, the prices of petroleum products including LPG in the country are linked to the prices of related products in the international market. Average prices of Saudi CP, on which domestic LPG prices are based, increased from US$ 454/MT to US$ 693/MT during 2019-20 to 2021-22. The average Saudi CP during 2022-23 has increased to US$ 710/MT by February 2023, the ministry said in a reply to Parliament recently. However, the government continues to revise the effective price of domestic LPG. Public sector oil marketing companies have suffered huge losses on the sale of domestic LPG.

Know the status of Pradhan Mantri Ujjwala Yojana

Pradhan Mantri Ujjwala Yojana (PMUY) was launched in 2016 to provide LPG connections to women members of poor households, under which 8 crore connections were given. Under Ujjwala 2.0, all PMUY beneficiaries are provided with a free first refill and stove apart from a free LPG connection. Under Ujjwala 2.0, till February 1, 2023, 1.6 crore connections have been given. During the COVID-19 pandemic, the government announced a scheme to provide three free LPG refills to Ujjwala beneficiaries from April 1, 2020, under the Pradhan Mantri Garib Kalyan Package (PMGKP).

Oil marketing companies are facing losses

Oil Marketing Companies (OMCs) transferred Rs 9670.41 crore to the bank accounts of PMUY beneficiaries for purchasing LPG refills and PMUY beneficiaries availed 14.17 crore refills under the scheme. To further incentivize the use of LPG by PMUY beneficiaries, from May 2022, the government has introduced an additional targeted subsidy of Rs 200 per 14.2 kg refill to PMUY consumers for up to 12 refills in a year for FY 2022-23.

The ministry also informed that public sector oil marketing companies have suffered huge losses on the sale of domestic LPG. To compensate for these losses, the government has recently approved a one-time compensation of Rs 22,000 crore for LPG.

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