In a setback to non-state LPG marketing firms, the government’s top law officer has ruled that all domestically produced cooking gas (LPG) should be sold to public sector units for subsidised sale to consumers.
Ranjit Kumar, Solicitor General of India (SGI), has upheld the oil ministry’s view that sale of LPG by domestic producers to anyone other than state-owned oil marketing companies is not permissible under the LPG Control Order, sources said.
Non-state LPG sellers, also known as ‘parallel marketeers’, cannot source the fuel from domestic refiners, he added. They have to import LPG if they intend to sell the fuel in domestic market.
While India has surplus refining capacity, it does not produce enough LPG to meet all of its demand. LPG is produced by both public sector firms such as IOC as well as private firms including Reliance Industries. This LPG is sold to consumers mostly through distributors appointed by the government, at subsidised rates.