Hyderabad: The price of a subsidised domestic LPG cylinder and a non-subsidised one is narrowing fast.

The price of a domestic LPG subsidised cylinder has been revised upwards by Rs 2 every month since July 2016, and by Rs 4 from August 2017. The intention seems to be to remove the subsidy totally by March 2018.

At present, a subsidised cylinder in Hyderabad costs Rs 495.68 and a non-subsidised cylinder Rs 646. In August, the non-subsidised price was Rs 572, but from September 1, it was increased by Rs 74.

Each consumer is entitled to 12 subsidised cylinders a year (April 1 to March 31). Above that limit the consumer pays at the non-subsidised rate.

The price difference between a subsidised and non-subsidised cylinder was Rs 77 till August 2017. On September 1, the non-subsidised rate was increased by Rs 74, due to which consumers are now getting a subsidy of nearly Rs 150.

When the Direct Benefit Scheme (DBT) was introduced in June 2013, the amount of the subsidy being reimbursed in one’s bank account was Rs 435. Today, the subsidy component is between Rs 70 and Rs 150 per cylinder due to the continuous increase in the price of subsidised LPG every month since July 2016.

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The subsidised cylinder price was just Rs 456.83 in September last year, which has increased by Rs 40 within a year, imposing a burden on consumers.

The government has issued LPG connections to lakhs of BPL (below poverty line) families in the last two years under the Deepam and Pradhan Mantri Ujjwala Yojana schemes. Now that it has increased the price of cylinders, these people will be badly affected.

The short-sightedness of such a policy is evident as people will revert to using firewood rather than gas. Already, women self-help groups who cook the government mandated mid-day meals in thousands of government schools in villages across the country, as well as social welfare hostels, have stopped using cylinders and are opting for firewood.

“Out of the total subsidy component, Rs 28 is borne by the Centre and the rest is borne by oil manufacturing companies (OMCs). There are indications that the Centre may eliminate only its component of the subsidy, which is Rs 28, by March 2018. Consumers will continue to receive the OMC subsidy component after that. But clarity on this is yet to come,” said Mr K. Jagan Mohan Reddy, general secretary, TS LPG Distributors’ Association.

There are nearly one crore domestic LPG connections in TS, of which 91 lakh are active. This includes 23.25 lakh connections given to BPL families under the Deepam scheme.

The government is planning to issue another 20 lakh Deepam connections to achieve the goal of making TS a ‘kerosene-free state’. But the higher price they have to pay is discouraging BPL families from taking new connections, and even those who have a connection, are turning to firewood again.