Anurag Thakur, the information minister told the media on Wednesday that the Indian government has granted a one-time grant of Rs 22,000 crore to state-run fuel dealers for selling cooking gas (LPG) at prices below market.
The one-time grant to the three oil marketing companies, Indian Oil Corporation (IOC), Bharat Petroleum Corporation Ltd (BPCL), and Hindustan Petroleum Corporation Ltd (HPCL), was approved by the Union Cabinet, which is chaired by Prime Minister Narendra Modi, at a meeting on Wednesday, Thakur said at the news briefing.
The grant will be used to pay for the losses they incurred from June 2020 to June 2022 when selling LPG below cost to consumers.
The three companies offer clients domestic LPG at prices that are governed by the government.
The price of LPG on the international market increased by over 300% between June 2020 and June 2022.
An official statement noted that the price rise was partially passed on to local LPG consumers in order to protect them from changes in the price of LPG overseas.
Accordingly, domestic LPG prices have only increased by 72% over this time, it said, adding that this resulted in huge losses for the three firms.
"The three PSU OMCs have maintained consistent supplies of this essential cooking fuel in the nation despite these losses. In order to make up for these losses in domestic LPG, the government has decided to provide a one-time grant to the three PSU OMCs," it stated.
The three oil marketing corporations will receive a one-time subsidy totaling Rs 22,000 crore from the Union Cabinet (OMCs).
The PSU OMCs would benefit from this decision as they strive to uphold their commitment to the Atmanirbhar Bharat Abhiyaan by maintaining uninterrupted domestic LPG supplies and encouraging the purchase of Made in India products.
