Zee Media Bureau
New Delhi: The Cabinet Committee on Economic Affairs (CCEA) on Thursday approved raising the quota of subsidised LPG cylinder from nine to 12 per household annually.
The hike comes following the recommendation by Congress vice president Rahul Gandhi, who while addressing a meeting of the AICC last week, opined that for raising the cap to 12 cylinders per household from the existing nine.
Starting February, each household will be allowed to get 1 subsidised LGP cylinder for usage.
"Cabinet Committee on Political Affairs decides to allow households to get 1 subsidised LPG cylinder a month from February", Oil Minister Veerappa Moily said.
Increasing the limit to 12 units per year will result in costing the government Rs 5,000 crore more in subsidy.
"Hiking subsidised LPG quota will cost Rs 5,000 crore more in subsidy", Moily added.
The government already incurs about Rs 46,000 crore per annum as LPG subsidy.
In September 2012, in a bid to cut its subsidy bill, the government had capped the supply of subsidised domestic LPG cylinders to six per household annually. The quota was later raised to nine in January 2013.
With the quota increased, it means that 97 percent of LPG consumers would be covered by subsidised LPG.
Consumers who have exhausted their quota have to buy LPG at the market price of Rs 1,258 per cylinder. Subsidised LPG costs Rs 414 per cylinder in Delhi.
With Agency Input