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Rich homes may pay double for LPG

business Updated: May 04, 2012 22:46 IST
Anupama Airy
Anupama Airy
Hindustan Times
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Households with a monthly income of Rs 50,000 or more may soon have to pay the market price of cooking gas (LPG), which is Rs 480 more than the current price of around Rs 400 per cylinder.

Top petroleum ministry sources said a proposal to restrict the supply of subsidised LPG cylinders to the affluent class is ready for consideration of the empowered group of ministers (EGoM) under finance minister Pranab Mukherjee.

The idea is to replicate what happened a few years back, when people who could afford stopped buying food grains from public distribution system (PDS) shops despite having ration cards. http://www.hindustantimes.com/Images/Popup/2012/5/05_05_12-buss27b.jpg

As a first step, it is proposed to withdraw the supply of subsidised cylinders to all members of Parliament, MLAs and first class gazetted officers. This scheme will then be extended to all households with a monthly income of Rs 50,000 or more.

It has also been proposed that the affluent can buy the subsidised LPG and pay the market price difference to the oil companies directly through cheques.

The other way would be that these classes start buying the blue-coloured 19-kg cylinders that are currently being sold at market price of about Rs 1,200 per cylinder.

“We need to do away with a large part of subsidies going to the class of people who do not need subsidies,” a senior petroleum ministry official said.

In addition, households in all major cities having piped gas connections will now have to compulsory surrender their cooking gas connections or choose between the two connections. If piped gas consumers refuse to surrender their LPG connections, they will have to be ready for discontinuation of gas supplies coming to their kitchens.

Dual connections also encourage the menace of black marketing of LPG cylinders.