Oil Ministry may propose to hike LPG price by Rs 250 per cylinder

Post By

Sammy Y

Date Posted

04-Jul-2014

LOCATION

Thane

Oil Ministry may propose to hike LPG price by Rs 250 per cylinder

The Oil Ministry is likely to move the Cabinet Committee on Political Affairs (CCPA) soon with an expert panel recommendations of raising cooking gas (LPG) rates by Rs 250 per cylinder and kerosene price by Rs 4 a litre.
The ministry is preparing a draft note for consideration of the CCPA on pricing of diesel, kerosene and LPG, official sources said. Endorsing the previous UPA government's monthly 40-50 paisa per litre increase in diesel prices, the ministry is likely to propose that the monthly revisions may continue till the present Rs 3.40 a litre loss on the fuel is fully bridged.
After the diesel subsidy is eliminated during the course of the year, the ministry wants CCPA to authorise it to decontrol or free price of diesel as was done in case of petrol in June 2010. Since its decontrol, petrol rates are revised on 1st and 16th of very month based on average cost in the previous fortnight. Barring a few exceptions, petrol prices have moved in tandem with cost since then.
 
Sources said the ministry wants the CCPA to consider recommendations of an expert panel headed by former Planning Commission member Kirit S Parikh. The committee had in October 2013 recommended to the government that diesel prices should be hiked by Rs 5 per litre, kerosene by Rs 4 a litre and domestic LPG rates by Rs 250 per cylinder immediately to cut fuel subsidy bill by Rs 72,000 crore.
But as the monthly increases have led under-recoveries, or the difference between cost and retail price, falling below Rs 5, the ministry is unlikely to press for implementation of the panel's recommendation on diesel. Besides diesel, state-owned oil firms at present lose Rs 33.07 a litre on kerosene sold through the public distribution system (PDS) and Rs 449.17 on LPG, they said.
The Parikh Committee had suggested liquiditing all of the diesel subsidy within one year and was for restricting supply subsidised LPG cylinders to 6 bottles of 14.2-kg per household in a year. Currently, households are entitled to 12 cylinders of LPG on subsidised rates. The sources said the ministry is not taking this recommendation of the panel to the CCPA.
If rates are not increased, state-owned oil firms are projected to end the current fiscal with Rs 1,07,850 crore of under recovery or revenue losses. This will have to be met through a combination of government cash subsidy and contribution from upstream firms like ONGC.
The sources said the ministry is also taking to the CCPA the expert panel's recommendation of continuation of existing pricing principles for controlled petroleum products despite the Finance Ministry's objections. The Finance Ministry is pushing for refiners being paid the equivalent of rates they would have realised if diesel, kerosene and LPG were exported.
The export parity pricing (EEP), it feels, will cut its subsidy outgo by Rs 13,000 crore. After discounting the quality specification of fuel exported by private refiners, the difference between the EPP and currently practiced trade parity pricing was only Rs 108 per kilolitre or 1.5 per cent.

Views: 852

Similar Posts

Kejriwal raises host of issues in Gujarat, wants answers from Modi

New Delhi: Facing the lion in his den, that's what Aam Aadmi Party leader Arvind Kejriwal is about to do. He is on his way to meet Narendra Modi, the prime ministerial candidate of the Bharatiya Janata Party and also Gujarat Chief Minister. "There is corruption in government offices, agricultural output is declining, small industries are shutting down. What is Modi doing? His claims of development are all false," Kejriwal said.

07-Mar-2014

n boon for BJP-led coalition, Raj Thackeray may not contest Lok Sabha election

Mumbai: Raj Thackeray and his Maharashtra Navnirman Sena (MNS) may not contest the national election, a decision that could translate into a spectacular advantage for the BJP in India's second most politically vital state, Maharashtra.Sources say the MNS leader may stand down in the Lok Sabha polls, due by May, to help the BJP and Shiv Sena consolidate anti-Congress votes. As part of the deal, the MNS may opt for a tie-up with the BJP-led coalition for the Maharashtra assembly due in...

07-Mar-2014

Decoding Kiran Kumar Reddy's gameplan

As Kiran Kumar Reddy and the assortment of four ex-Congress MPs and a former state minister joined hands and raised them in the air, one couldn't help thinking - "How Third Frontish". After all, this 'Hands Up' style is patented by the group of the Lefties, the Mulayams and the Deve Gowdas that comes together once every five years, driven by the common ambition to put their hand up to become the next prime minister of India. Kiran Reddy is also the Third Front in the new divided state of...

07-Mar-2014

MNS to contest polls, supports Modi and declares war against Sena

The first list of seven candidates consists of filmmaker Mahesh Manjarekar who will make his electoral debut from Mumbai North West seat, currently represented by Congress MP Gurudas Kamat. Shiv Sena has announced nomination of party veteran Gajanan Kirtikar from this seat whereas AAP has fielded Mayank Gandhi.   Raj's declaration to contest Lok Sabha polls came days after former BJP chief Nitin Gadkari appealed to him in a private conclave here to not field candidates in a bid to avoid...

10-Mar-2014

Minister Gopinath Munde killed in road accident

Rural Development Minister Gopinath Munde died in a road accident while on his way to the Indira Gandhi International Airport in New Delhi on Tuesday.According to reports, the accident happened at 6:30 am when a vehicle rammed his Ambassador car from behind near Moti Bagh locality in South Delhi.AIIMS Spokesperson Amit Gupta said, "He (Munde) was brought to AIIMS trauma centre at 6:30 am by his personal assistant and driver. His car had been hit by another vehicle at 6:20 am after which he...

03-Jun-2014

Railway Budget

Modi Sarkar Has Submited Rail Budget For 2014.

08-Jul-2014

Rail budget 2014

Railway Minister DV Sadananda Gowda promised bullet trains, dedicated freight corridors, a diamond quadrilateral high-speed rail network, enhanced passenger amenities and augmented cargocarrying capacity in his budget for the year ended March 2015. While he spelt out some of the measures for resource mobilisation including leveraging the surplus of railway public sector units, Gowda didn't give a timetable or explain the mechanism via which the organisation would generate funds throug .....

09-Jul-2014

Arun Jaitley flip flop: Deletes blog post demanding release of Henderson Brooks

"What has been made public is Part-I of the report? It has been reported in the media that pages 112 to 167 are still not known. Is it because these pages contain some material which can be embarrassing to those in power in 1962? The first 111 pages having been made public, it is now necessary that the balance pages also be made public rather than allow public opinion be influenced by unauthentic sources."   The above paragraph is taken from Union Defence Minister Arun Jaitley's blog...

10-Jul-2014

Rail budget 2014

NEW DELHI: As many as 58 new trains, including five new 'Jansadharan' trains and an equal number of premium group of trains have been proposed in the Rail Budget presented by railway minister Sadananda Gowda on Tuesday. The new trains include six AC Express trains, 27 Express trains, eight passenger trains, two Mainline Electric Multiple Unit (MEMU) services and 5 Diesel Electric Multiple Unit (DEMU) services besides extension of 11 existing trains.     Jansadharan Trains i)...

10-Jul-2014

Budget 2014: American corporate houses ready to pump money into India

Anticipating major economic reforms in the maiden budget to be presented by the new Indian government, Corporate America has said it is ready to invest billions of dollars in India but the budget must match "pragmatism with unbridled enthusiasm". Through this budget, the Obama Administration, policy makers, corporate sector and economists in the US are hoping to see a strong sign of a the major economic reforms which were promised by Prime Minister Narendra Modi during his election...

10-Jul-2014
Mark My Deal