press trust of india
New Delhi, July 31: The government has ordered state-run oil companies to raise subsidised cooking gas (LPG) prices by `4 per cylinder every month to eliminate all the subsidies by March next year, Oil Minister Dharmendra Pradhan said Monday.
The government had previously asked Indian Oil (IOC), Bharat Petroleum (BPCL) and Hindustan Petroleum (HPCL) to raise rates of subsidised domestic LPG (liquefied petroleum gas) by `2 per 14.2-kg cylinder per month (excluding VAT).
Now, the quantum has been doubled so as to bring down the subsidy to nil, he said in a written reply in the Lok Sabha here.
Every household is entitled to 12 cylinders of 14.2-kg each at subsidised rates a year. Any requirement beyond that is to be purchased at market price.
“Public sector oil marketing companies (OMCs) were authorised to increase price of subsidised domestic LPG cylinder by `2 per cylinder (14.2-kg) per month (excluding VAT) with effect from July 1, 2016,” he said.
Oil companies had hiked LPG rates on 10 occasions since that go-ahead.
“The government vide its order dated May 30, 2017, has again authorised OMCs to continue increasing the effective price of subsidised domestic LPG by `4 per cylinder from June 1, 2017, per month (excluding VAT) till the reduction of government subsidy to ‘nil’, or till March 2018, or till further orders, whichever is earliest,” he said.
Oil companies have raised rates twice since, the last being July 1 when rates were up by a steep `32 per cylinder – the steepest increase in six years. This hike was because of the May 30 order as well as a reflection of the hiked tax rates under the Goods and Services Tax (GST) regime.
