SUBSIDIES FOR COOKING GAS INCREASED TO BENEFIT LOW-INCOME INDIVIDUALS

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"Cooking gas subsidy increased, bringing smiles to the poor"

On Wednesday, the government increased subsidies for women from economically disadvantaged backgrounds who have received free cooking gas connections through the Ujjwala Yojana program. The subsidy for 14.2kg cylinders has been raised from Rs 200 to Rs 300 per cylinder for up to 12 refills annually. This move aims to address Opposition criticism regarding high fuel prices and will benefit 9.6 crore families.

In preparation for assembly elections in five states, including Madhya Pradesh and Rajasthan, the government had previously reduced cooking gas prices by Rs 200 per cylinder in late August. As a result, the price of an LPG cylinder dropped to Rs 903. For Ujjwala beneficiaries, the price was reduced to Rs 703 after considering the Rs 200 per cylinder subsidy, which is directly deposited into the bank accounts of connection holders. With the subsidy increase, a 14.2-kg LPG cylinder will now cost Rs 603 for Ujjwala beneficiaries.

This decision comes in response to criticism from Opposition parties regarding high LPG prices, with some parties, like the Congress, promising LPG cylinders at Rs 500 if elected to power. The exact additional subsidy cost incurred by this move was not disclosed by Anurag Thakur, the Union information and broadcasting minister.

cooking gas subsidy

For the financial year 2022-23, Rs 6,100 crore was allocated for the Ujjwala subsidy, which has now risen to Rs 7,680 crore for the current 2023-24 fiscal year. The increased fiscal expenditure is estimated to be approximately Rs 3,600 crore annually, according to Madhavi Arora, an economist at Emkay Global Financial Services, as reported by Reuters.

Given the approaching elections, the government is striving to prevent higher inflation from overshadowing its past and recent accomplishments, as explained by Sunil Sinha, an economist at India Ratings, in an interview with the news agency.

Additionally, the government has established the National Turmeric Board to promote the cultivation of turmeric, a medicinal herb. The board’s focused efforts aim to boost turmeric exports to $1 billion by 2030, fulfilling a long-standing demand of farmers in Telangana. In 2022-23, over 75% of global turmeric production came from an area of 3.24 lakh hectares in India, producing 11.61 lakh tonnes of turmeric in more than 30 varieties across 20 states.

On the energy front, Shell India has raised diesel prices significantly, by up to Rs 20 per litre, within a week. Meanwhile, public sector fuel retailers have maintained a freeze on rates for a record 18 consecutive months. With international oil prices hovering around $90 per barrel, Shell India, a subsidiary of the world’s second-largest oil and gas company, began increasing fuel prices by Rs 4 per litre daily. As a result, Shell India is now selling diesel at Rs 130 per litre in Mumbai and Rs 129 in Chennai, compared to the price of Rs 106.31 per litre for petrol at public sector company pumps in Mumbai and Rs 102.63 in Chennai. Diesel at public sector pumps costs Rs 94.27 per litre in Mumbai and Rs 94.24 in Chennai.

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