Oil Minister Dharmendra Pradhan on Monday said that the Government capped the subsidy payout on kerosene at Rs12 per litre and domestic cooking gas (lPG) at Rs18 per kg.
“While the Government will provide Rs12 to meet most of this, the remaining Rs 2.95 will be borne by oil producers ONGC and Oil India ltd,” Pradhan said.
Kerosene through public distribution system (PDS) is sold at Rs14.96 per litre against the actual cost of Rs29.91. The difference between the two, Rs14.95 per litre, is termed as under-recovery or revenue loss.
Similarly, there is an under-recovery or loss of Rs167.18 on sale of every 14.2-kg subsidised lPG cylinder at the current price of Rs417.82. At current rates, all of the under-recovery is within the sanctioned subsidy limits.
“At present, the state-owned fuel retailers incur under-recoveries on sale of PDS kerosene and subsidised domestic lPG only as petrol and diesel have been deregulated (market-linked) with effect from June 2010 and October 2014 respectively,” Pradhan said. For 2015-16, the Government has approved budgetary support for PDS kerosene under-recovery at a rate of Rs12 per litre and the remaining under-recovery will be borne by the upstream companies. PTI