Millennium Post

India’s DBT for LPG world’s largest benefit transfer scheme

The scheme of giving cash subsidy on cooking gas directly to consumers has become the world's largest direct benefit transfer with 2.5 crore households getting about Rs 550 crore since November 15. The direct benefit transfer on LPG (DBTL), under which cash subsidy is paid to consumers so that they can buy cooking gas at market price, was rolled out in 54 districts from November 15 and will be extended all over the country from January 1.

"In 54 districts, 75 per cent of the population is now covered by DBTL," Oil Minister Dharmendra Pradhan said here. "DBTL today has become the world's largest direct benefit transfer scheme."  The scheme has surpassed number of beneficiaries in direct benefit transfer programmes in China and Brazil. Pradhan said he has personally reviewed roll out of the scheme in as many as 42 districts so far and will do so in 10 or so before the end of the year. "Out of such a large number of users joining the scheme, we received only 3,000 complaints, 80 per cent of which have been addressed within 7 days."

His ministry officials as well as top executives of oil marketing companies have adopted one district each in the country to oversee roll out of the scheme under which consumers have to get their bank accounts seeded with their LPG connection.

The moment they join the scheme, oil companies transfer advance cash subsidy in their bank accounts to enable them to buy LPG refills at market rate. Once a consumer takes delivery of the cylinder, another advance cash subsidy is transferred to the bank account. At present, a subsidised LPG cylinder costs Rs 417 per 14.2-kg bottle while its market price is Rs 752, the difference being the subsidy component.

"I have adopted Palwal in Haryana while IOC Chairman (B Ashok) is incharge of New Delhi. BPCL Chairman S Varadarajan has adopted Nasik in Maharashtra and likewise each of the 676 districts in the country has been taken over by some senior official," Pradhan said.  From January 1, LPG consumers across the country will have to buy cooking gas at market rates. They will get the difference between current subsidised rate and market price for 12 cylinders in a year in cash that will be transferred to their bank acounts. The Direct Benefit Transfer Scheme for LPG, which has now been renamed PAHAL, has been modified to exclude the requirement of unique identification number (Aadhaar) for availing the cash subsidy. Aadhaar is now optional but consumers should have a bank account linked to their LPG connection number.

PAHAL or Pratyaksh Hanstantarit Labh has been rolled out in 54 districts from November 15 and will extend to rest of the country from January 1.

DBT (direct benefit transfer) is designed to ensure that the subsidy meant for genuine domestic customers reaches them directly and is not diverted. "We anticipate that 10-15 per cent savings in the subsidy bill," he said. In 54 districts covering 11 states, the scheme covers 2.33 crore households. Currently, the Aadhaar generation level is 95 per cent in these districts. 
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