The government has approved the launch of a pilot project that will entail transfer of domestic LPG subsidy directly to the consumers’ account in 20 districts from May 15.
The Cabinet Committee on Political Affairs at its meeting late on Thursday gave the go-ahead for the scheme, which is likely to be launched across the country in October. Under the direct benefit transfer (DBT) scheme, consumers will get the subsidy amount — about Rs. 4,000 annually — in their bank accounts. They will then have to buy LPG at the current market price of Rs. 901.50 per 14.2-kg cylinder.
A consumer is now entitled to nine cylinders at the subsidised price of Rs. 410.50. He will have to pay the market price for more cylinders.
The DBT scheme is aimed not only at eliminating diversion of domestic LPG into the black market, but also ending leakage in distribution. “With the subsidy going directly [to the consumers’ accounts], there will be only one price at which cylinders will be sold at a dealer’s shop. This will eliminate ghost connections and diversion of cylinders,” an official statement issued here said.
A consumer will have to get his or her bank account seeded with the Aadhaar number for getting the LPG subsidy. While about 32 crore Aadhaar cards have been issued by the Unique Identification Authority of India (UIDAI), only 80 lakh bank accounts have been linked to the numbers so far, officials said.
Although, the Finance Ministry has asked public sector banks to get ready for the DBT scheme, an October 1 launch will be an uphill task going by its current progress.
