Government persuading affluent customers to voluntarily give up subsidised LPG

The Narendra Modi government hopes to save Rs 3,500 crore in oil subsidies by persuading 1 crore affluent customers to voluntarily pay market rates for cooking gas in response to text messages to customers inviting them to opt out of the subsidy for the sake of 'nation building'.

The subsidy cut is significant as it amounts to half the annual net profit of Indian Oil Corp, the country's largest refining and marketing firm. It will also help oil companies expand cooking gas supply to rural areas, which would give the government political mileage, reduce pollution in rural kitchens, which causes many diseases, and also help control deforestation by reducing the need for firewood, officials said.

Oil firm executives say the list of customers opting out of subsidy would publicly expose the rich and powerful who want to hang on to benefits meant for the poor and ignore text messages saying: 'Give up your LPG subsidy and be part of nation-building movement to provide subsidised cooking fuel only to needy'.

This is the second stage of the campaign, in which many executives of state oil firms have started buying cooking gas at market rates, or about 450 more than the subsidised rates.

ET first reported on July 5 that the scheme would soon be launched for the public through portals, which do not involve cumbersome paper work. In the past one month, nearly 2,000 consumers have opted out of the subsidy net, saving over 1 crore per annum, the official said.

Indian Oil Corp (IOC), Hindustan Petroleum Corp Ltd and Bharat Petroleum Corp Ltd have put in place an online system that allows a person to surrender his subsidy. IOC, which supplies gas under the Indane brand, has launched a website 'myindane.in' to facilitate customers and informing them through SMSes, company executives said. "We call upon all LPG consumers who can afford to pay the market price for their LPG supply to be a part of this nation-building exercise by giving up LPG subsidy," IOC's message on the website said.

Source:-The Economic Times