Cooking gas relief on way

New Delhi, Nov. 6: The number of subsidised domestic LPG cylinders to be sold to a consumer in a year could be increased as the petroleum ministry is reviewing the six-cylinder cap imposed in September that triggered widespread criticism.

Indications are that the number of subsidised cylinders can be increased to nine.

"State-owned oil firms (IOC, BPCL and HPCL) have been asked to provide the latest LPG consumer data which could be studied and a decision on increasing the number of subsidised cylinders from six a year could be taken," a senior oil ministry official said.

The oil firms have been conducting a "know your customer" (KYC) drive, which would bring clarity on the number of customers.

Sources said HPCL had identified 36 lakh connections to be checked for multiple connections. HPCL and BPCL both have blocked one lakh connections each, and the number from IOC is likely to be much higher, they added.

If a customer has more than one connection in the same name and same address, he/she will be able to retain only one. The deadline for submitting the KYC details has been extended to November 15.

Further, the oil firms have found that of the 14-crore customers, only around 10 crore were genuine consumers; others existed only on paper to help divert subsidised cylinders for commercial use.

By capping the supply of subsidised cylinders, the government expected not only to save on subsidy but also reduce misuse. The cap will help in reducing the under-recovery by about Rs 5,300 crore for the remaining part of the financial year.

The under-recovery on sale of domestic LPG during 2012-13, even after this measure, is estimated to be above Rs 32,000 crore.

Under the revised regime, a 14.2-kg cylinder that consumers in Calcutta buy beyond their entitled six at subsidised rates is priced at Rs 925, which is more than double the price of subsidised cylinders at Rs 412.50.

The need for a relook at the ceiling comes amid increasing criticism in poll-bound states and pressure from the ruling Congress party and allies to increase the cap.