Hike in LPG subsidy for Ujjwala beneficiaries; 9.6 crore families to be benefited

New Delhi: The government on Wednesday raised the subsidy provided to poor women, who got free cooking gas connections under the Ujjwala Yojana, to Rs 300 per cylinder as it looked to blunt opposition criticism of high fuel prices.

The Cabinet Committee on Economic Affairs raised the subsidy from Rs 200 per 14.2-kg cylinders for up to 12 refils per year to Rs 300 per bottle, Union Information and Broadcasting Minister Anurag Thakur told reporters here.

The move will benefit 9.6 crore families.

Ahead of assembly elections in five states, including Madhya Pradesh and Rajasthan, the government had in late August cut cooking gas price by Rs 200 per cylinder. After this, LPG cylinder price came down to Rs 903.

For Ujjwala beneficiaries, the price was Rs 703 after considering the Rs 200 per cylinder subsidy, which is directly paid into the bank accounts of connection holders.

After the increase in subsidy, a 14.2-kg LPG cylinder will now cost Rs 603 for Ujjwala beneficiaries.

The move follows criticism by opposition parties of high LPG price. Parties like Congress are promising LPG cylinder at Rs 500 if voted to power.

The hike in subsidy is being seen as an attempt to blunt that criticism. Thakur did not say how much additional subsidy outgo the move would entail.

For 2022-23, Rs 6,100 crore was provided for the Ujjwala subsidy, which increased to Rs 7,680 crore in the current 2023-24 fiscal (April 2023 to March 2024).

The subsidy is credited directly to the bank accounts of eligible beneficiaries. The targeted support to Pradhan Mantri Ujjwala Yojana (PMUY) consumers encourages them for continuous use of LPG.

The average LPG consumption of PMUY consumers increased 20 per cent from 3.01 refills in 2019-20 to 3.68 in 2021-22.

All PMUY beneficiaries are eligible for the targeted subsidy.

To make Liquified Petroleum Gas (LPG), a clean cooking fuel, available to rural and deprived poor households, the government launched Pradhan Mantri Ujjwala Yojana in May 2016, to provide deposit-free LPG connections to adult women of poor households.