Govt to hike subsidised LPG cylinders from 9 to 12 today?

The government on Thursday is likely to increase the number of subsidised domestic LPG cylinders given to individual consumers from nine to 12 a year after Congress Vice President Rahul Gandhi told Prime Minister Manmohan Singh  the present allocation wasn't enough.

Reuters

"Prime Ministerji, nine cylinders are not enough... the people want 12 cylinders not nine," Gandhi had said on 17 January, during an AICC meeting in New Delhi.

Immediately after the meeting, MoS in the Prime Minister's Office V Narayanasamy had said that the government will raise the allocation as Gandhi had made the request and he was the de facto leader of the Congress.

Last week, Oil Minister M Veerappa Moily had said the Cabinet was likely to soon consider increasing the quota of subsidised cooking gas cylinders.

"After our vice president Rahul Gandhi said nine cylinders are not enough, I have moved a Cabinet note to increase the quota to 12. I think the Cabinet is likely to consider the proposal this week," Moily had said after launching the sale of 5-kg cooking gas (LPG) cylinders at petrol pumps in the national capital.

The move is likely to benefit 10 percent of domestic LPG consumers who use above nine cylinders in a year.

The minister had said 89.2 percent of the 15 crore LPG consumers use up to nine cylinders in a year and it was only 10 percent of the consumers that have to buy the additional requirement at the market price. If the quota is raised to 12, about 97 percent of the LPG consumers would be covered by subsidised LPG, he said.

But increasing the subsidy will also come at a cost for the government. If the Cabinet does agree to a hike, which in all likelihood will happen, it will result in an additional fuel subsidy burden of Rs 3,300 crore-4,000 crore. The government already incurs about Rs 46,000 crore per annum as LPG subsidy.

The government had initially capped the supply of subsidised domestic LPG cylinders to six per household annually in September 2012 in a bid to cut its subsidy bill. The quota was raised to nine in January 2013.

With inputs from PTI