- Domestic LPG cylinder price hiked by Rs 29 per unit.
- Price in Delhi reaches Rs 942, second hike in months.
- Government cites global energy costs, West Asia disruptions.
India has once again increased the prices of domestic cooking gas by Rs 29 per cylinder, marking the second hike in three months as state-owned oil marketing companies continue to face pressure from elevated global energy costs. With effect from Sunday, the price of a 14.2-kg domestic LPG cylinder in Delhi has been raised to Rs 942 from Rs 913, news agency PTI reported, citing industry sources.
Lowest price in the world: govt
However, according to the government, Indian households continue to pay among the lowest prices for cooking gas globally despite a sharp rise in international LPG prices triggered by disruptions in West Asia.
The price of a 14.2-kg domestic LPG cylinder in Delhi was raised to Rs 942 from Rs 913, while beneficiaries of the Pradhan
Mantri Ujjwala Yojana (PMUY) will continue to pay an effective Rs 642 per cylinder after receiving a subsidy of Rs 300 per refill on the first four refills annually, down from 9 refills announced last year.
The increase follows a Rs 60-per-cylinder hike on March 7, taking the cumulative hike to Rs 89 per 14.2-kg cylinder. State-run oil marketing companies were estimated to be losing about Rs 703 on every LPG cylinder sold before the latest revision.
How much the Indian government pay for one cylinder?
In a statement, the government said the cost of supplying a domestic LPG cylinder has risen to more than Rs 1,600 following a surge in international prices that followed the outbreak of war in West Asia in early February.
India's LPG import costs are linked to the Saudi Contract Price (CP), the global benchmark for the fuel. The benchmark has risen about 46 per cent since February after disruptions linked to the Strait of Hormuz tightened supplies from the Gulf region, according to the statement.
Despite the increase, domestic LPG prices remain below those prevailing in neighbouring countries such as Pakistan, Nepal, Bangladesh, and Sri Lanka, and significantly lower than prices in advanced economies, including the United States, Australia, and Canada, the government said.
The government also said India was among the few countries able to maintain uninterrupted energy shipments through the Strait of Hormuz during the crisis, ensuring there was no shortage of LPG or other petroleum products in the country. Domestic LPG production was increased and supplies diversified through alternative sourcing arrangements to safeguard availability, it added.
Govt subsidy on LLG
According to the statement, cumulative under-recoveries on domestic LPG sales rose to about Rs 60,000 crore by the end of the previous financial year, compared with Rs 41,338 crore a year earlier. The Union Cabinet has approved Rs 30,000 crore in compensation to state-run oil marketing companies to partly offset these losses.
The government said the latest revision balances the need to shield households from volatile global energy prices while ensuring the continued availability of cooking fuel across the country.
"The prices of petroleum products in India are linked to the corresponding prices in the international market. The government, however, continues to modulate the effective price to the consumer for domestic LPG. Any household can buy as many cylinders as it needs at Rs 942," the statement said.
"A PMUY beneficiary will additionally receive the direct benefit transfer of Rs 300 a cylinder on the first four refills each year -- broadly the average annual consumption of a typical Ujjwala household, about four refills a year -- and so pays an effective Rs 642 on those refills; this support is unchanged."
Even a non-PMUY household would pay about Rs 700 below the market-linked cost of the cylinder.
(With inputs from agency)