New Delhi: The price of subsidized cooking gas (LPG) was raised on Friday by more than 7 rupees per cylinder, in line with the government’s decision to raise prices every month so that all subsidies are eliminated for this fiscal purpose.
A subsidized LPG cylinder of 14.2 kg now costs Rs 487.18 in Delhi against Rs 479.77 previously, according to Indian Oil Corporation, the country’s largest fuel retailer.
Oil Minister Dharmendra Pradhan told Lok Sabha on July 31 that the government had asked state oil companies to raise subsidized gas prices by Rs 4 per cylinder every month to eliminate all subsidies for March next year.
Fares were, however, increased by Rs 2.31 per cylinder on the previous due date on August 1 and oil companies have made a bigger hike to even that, sources said.
Since the implementation of the policy of monthly Rs 2 increases since July last year, subsidized LPG rates have increased by more than Rs. 68 per cylinder. A 14.2 kg LPG cylinder was rated at Rs 419.18 in June 2016.
The government had previously requested IOC, Bharat Petroleum Corporation Ltd (BPCL) and Hindustan Petroleum Corporation Ltd (HPCL) to increase rates of subsidized domestic LPG by Rs 2 per 14.2 kg of cylinder per month. The amount has now doubled to reduce the subsidy to zero.
Each household is entitled to 12 cylinders of 14.2 kg each at subsidized rates in one year. Any requirement beyond that must be bought at market price.
The price of unsubstituted LPG or cooking gas at market prices has also increased by Rs 73.5 to Rs 597.50 per bottle. The rates were in the last review cut by Rs 40.
Simultaneously, oil companies also raised fuel prices for aviation turbines (ATF) by 4 percent, according to higher world rates. ATF, or jet fuel, now costs Rs 50,020 per kilolitre, Rs 1,910 more than Rs 48,110 previously.
This rise comes on the back of a 2.3 percent increase made as of August 1. Also, the price of kerosene sold through the public distribution system (PDS) was raised by about 25 paise per liter.
The government is adopting the same policy as in the LPG to eliminate the kerosene subsidy. Since July 1 of last year, rates have been raised by 25 paise per liter every two weeks.
While Delhi has been declared a state without kerosene, the fuel now costs Rs 22.27 per liter in Mumbai compared to Rs 22 previously. The kerosene was on July 1, 2016, at a price of Rs 15.02 per liter in Mumbai. State oil companies review LPG and ATF rates on the first of each month based on the average oil price and the exchange rate of the previous month. The price increase for LPG is the fourth since the May 30 order of the Ministry of Petroleum to raise rates by Rs 4 per cylinder every month.
There are as many as 18,11 clients LPG crore subsidized in the country. These include 2.6 crore poor women who were given free connections during the last year under the Pradhan Mantri Ujjwala Yojna. There are another 2.66 users of non-subsidized cooking gas crust.
