LPG Subisdy Of Bharat Gas Customers To Continue Post Privatisation: Pradhan

LPG subsidy for Bharat Petroleum Corporation Limited (BPCL) consumers (sold as Bharat Gas cylinders) will continue post-privatisation, said Oil Minister Dharmendra Pradhan on Friday.

"Subsidy on LPG is paid to consumers directly and not to any company. So the ownership of the company that sells LPG is not of any material consequence," Pradhan told PTI.

Pradhan said it at the event to lay the foundation stone for the Leafiniti Bioenergy's CBG plant in Bagalkot district of Karnataka, which is attended through video conference.

Households in India are allowed a maximum of 12 LPG cylinders (14.2 kg) purchases per year at subsidized rates. However, cylinders have to be bought at full price at the time of purchase, and the subsidy is then credited to the customer's bank account by the government.

Consumers of LPG in India use this subsidy to buy refills from agencies of oil marketing companies- Indian Oil Corporation (IOC)- Indane, BPCL and Hindustan Petroleum Corporation Limited (HPCL).

BPCL is in the process of becoming a privately owned company as the government will sell its entire 53% stake along with management control in the company, as part of its divestment target for the year. The new owner will get 15.33% of India's oil refining capacity and 22% of the fuel marketing share.

Pradhan said the LPG subsidy payment is done digitally to all verified customers.

"Since it is paid directly to consumers, it does not matter if the servicing company is public sector or private sector," he said. "LPG subsidy will continue as before to BPCL consumers even after disinvestment."