LPG cap hiked to 12; no cash transfers

Aadhaar-linked LPG subsidy transfer put on hold

Acceding to Rahul Gandhi’s demand to raise the annual cap on subsidised LPG cylinders, the Cabinet Committee on Political Affairs on Thursday raised the quota from nine to 12.

It also decided to put on hold the Direct Benefit Transfer for LPG (DBTL) under which consumers receive subsidy in cash.

Every household will get one cylinder each in February and March in addition to the quota of nine. From April, they will be entitled to 12 cylinders, one a month at subsidised rates.

At the All India Congress Committee session on January 17, Mr. Gandhi had appealed to Prime Minister Manmohan Singh to increase the quota to 12 cylinders.

Petroleum and Natural Gas Minister M. Veerappa Moily said the rise in quota would result in an extra outgo of Rs.5,000 crore annually toward subsidy. On the DBTL, he said it was suspended as there were complaints about implementation of the scheme.

Terming the increase in LPG cylinder quota “misdirected subsidies”, RBI Governor Raghuram Rajan said the move would end up benefiting people who could afford to pay market rates.