Cabinet Approves Significant Subsidy Hike for LPG Cylinders Ahead of General Elections

Cabinet Approves Substantial LPG Cylinder Subsidy Hike Ahead of Elections

Cabinet Approves Substantial LPG Cylinder Subsidy Hike Ahead of Elections

In anticipation of the upcoming general elections, the Cabinet has taken a crucial step to provide relief to citizens by approving a substantial subsidy increase for domestic LPG (liquefied petroleum gas) cylinders. Anurag Thakur, the Union Minister for Information and Broadcasting, made the announcement, highlighting the government’s commitment to mitigating economic challenges faced by the population. This decision has been endorsed by the Cabinet Committee for Economic Affairs, chaired by Prime Minister Narendra Modi, with the goal of bolstering the advantages of the Ujjwala scheme and offering financial respite to households.

Enhanced Subsidy Unveiled

Under the new directive, the subsidy granted per domestic LPG cylinder has been elevated by Rs 200. Moreover, recipients of the Ujjwala scheme will experience an augmented subsidy of Rs 200 as well, resulting in a cumulative subsidy of Rs 400 per cylinder. This enhancement applies specifically to new connections acquired under the scheme, rendering them entirely cost-free. The government has demonstrated its commitment to bear the additional LPG subsidy expenditure, amounting to Rs 7,680 crore, for the upcoming fiscal year.

Combating Rising Prices

This strategic move arrives at a pivotal juncture as domestic LPG cylinder prices have escalated to Rs 1,103 per unit. The subsidy, directly credited to the bank accounts of eligible beneficiaries post-purchase, is designed to alleviate the financial strain caused by these elevated prices. This amplified subsidy is poised to benefit nearly one-third of the total LPG consumers across the nation.

Addressing Geopolitical Price Volatility

The recent surge in international LPG prices triggered by geopolitical factors has raised concerns about the accessibility of cooking gas. The decision to augment the subsidy aims to safeguard the interests of beneficiaries under the Pradhan Mantri Ujjwala Yojana (PMUY) from the impacts of soaring LPG costs.

Subsidy Allocation and Implementation Strategy

Earlier this year, in March, the Cabinet Committee on Economic Affairs introduced a subsidy of Rs 200 per LPG cylinder under the PMUY, valid for one year. Financial allocation for this initiative was earmarked at Rs 6,100 crore for the fiscal year 2022-23 and Rs 7,680 crore for 2023-24. The subsidy, facilitated through Public Sector Oil Marketing Companies including Indian Oil Corporation Ltd. (IOCL), Bharat Petroleum Corporation Ltd. (BPCL), and Hindustan Petroleum Corporation Ltd. (HPCL), had been operational since May 22, 2022.

Empowering Rural Households with PMUY

Launched in May 2016, the Pradhan Mantri Ujjwala Yojana seeks to empower economically disadvantaged households, particularly in rural areas, by providing them with deposit-free LPG connections. The subsidy, a cornerstone of the government’s flagship scheme, is directly transferred to the bank accounts of eligible beneficiaries.

Reinforced Subsidy Allocations

With an allocation of Rs 6,100 crore for the fiscal year 2022-23 and Rs 7,680 crore for 2023-24, the overall expenditure designated for PMUY reflects the government’s dedication to ensuring essential cooking gas accessibility and affordability to a wider population. This decision also underlines the government’s commitment to addressing economic concerns in the lead-up to the general elections, ensuring a smoother journey for citizens.