‘Six LPG cylinders per year figure is arbitrary’
30 Oct 2012 4:47 AM IST
While the govt has put a cap on the supply of subsidised cooking gas at six cylinders per household in a year, an expert committee report on ‘viable and sustainable system of pricing of petroleum products’ has said that households belonging to the poorest decile of urban consumers use eight cylinders whereas the top five deciles use 10 cylinders.
‘Coming up with a figure like six subsidised cylinders per year is arbitrage, any justification can be given for putting a cap on the number of cylinders,’ said Dr Himanshu, Assistant Professor, JNU, who was also part of the expert group which submitted the report to the the government in 2010. Himanshu is of the opinion that placing a cap on the cylinders will only encourage black marketing and instead the government should be have spread the subsidised figure, by increasing the price of the LPG cylinders.
Even the report states that ‘any scheme of rationing or limiting the number of cylinders at subsidised price without Smart Cards will involve a complex monitoring and inspection system more likely to promote Inspector Raj rather than effectively reduce subsidy.’
‘Coming up with a figure like six subsidised cylinders per year is arbitrage, any justification can be given for putting a cap on the number of cylinders,’ said Dr Himanshu, Assistant Professor, JNU, who was also part of the expert group which submitted the report to the the government in 2010. Himanshu is of the opinion that placing a cap on the cylinders will only encourage black marketing and instead the government should be have spread the subsidised figure, by increasing the price of the LPG cylinders.
Even the report states that ‘any scheme of rationing or limiting the number of cylinders at subsidised price without Smart Cards will involve a complex monitoring and inspection system more likely to promote Inspector Raj rather than effectively reduce subsidy.’
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