Amid fuel shortages, the government has taken some important decisions. On Monday, the central government significantly reduced the number of subsidized LPG cylinders, dealing a major blow to the benefits of the Pradhan Mantri Ujjwala Yojana. The government's important decision comes after oil marketing companies recently increased the price of a 14.2 kg domestic LPG cylinder. What impact will this have on consumers?

According to changes to the Ujjwala Yojana rules, PMUY beneficiaries will now receive a direct benefit transfer of ₹300 per cylinder for the first four refills. On average, a typical household under the Ujjwala Yojana uses about four refills a year; previously, PMUY beneficiaries received subsidies for nine refills a year.

105 million connections since 2016
The Pradhan Mantri Ujjwala Yojana was launched by the Modi government in May 2016. According to the Petroleum Ministry, PMUY has provided clean cooking fuel to millions of households, empowering women and improving the quality of life for Indian families. The scheme has fully benefited those in need. Since the launch of this government scheme, more than 105 million free LPG connections have been provided to women from poor families.

Rs 300 subsidy from the government
After the launch of the Ujjwala scheme, in order to keep LPG affordable, the government started giving a subsidy of Rs 200 on this 14.2 kg domestic LPG cylinder in May 2022 and increased it to Rs 300 per cylinder in October 2023, which is continuously accruing to the beneficiaries and this LPG subsidy is being deposited directly into the bank account of every individual. Refill If we look at the data of the Petroleum Ministry, the government has given Rs 52,000 crore as LPG subsidy till now.

Subsidy help continues despite losses
Due to tension in the Middle East and the closure of the Strait of Hormuz, increasing oil and gas crisis, the government oil marketing companies are incurring a loss of around Rs 700 on every domestic gas cylinder. Meanwhile, the price of the cylinder has also been increased, but the government is giving a subsidy of Rs 300 on every cylinder, which is a big relief for the beneficiaries of the Ujjwala scheme. For the common consumers, the price of a 14.2 kg cylinder is Rs 942, whereas under the subsidized Ujjwala scheme, the first four cylinders have to be refilled for Rs 642.

From 12 to 9, now only 4 cylinders
Under the Pradhan Mantri Ujjwala Yojana, beneficiaries were initially provided 12 subsidized cylinders per year. Last year, this number was reduced to 9. Now, in a significant decision, the subsidy has been limited to four LPG cylinders. The Petroleum Ministry has stated that this decision brings the financial assistance in line with actual average household consumption levels.

How much loss will the beneficiaries incur?
According to Praveen Mal Khanuja, Additional Secretary, Petroleum Ministry, the changed eligibility criteria have been decided on the basis of the average annual gas consumption of Ujjwala families. However, there has been no change in the subsidy amount on each refill. After this new change, the maximum annual assistance available to each beneficiary has been increased to ₹1,200. Talking about the impact on the beneficiaries, till now they were getting ₹2,700 annually with a subsidy of ₹300 for 9 LPG cylinders. Now this has been reduced by ₹1,500.

PC: Navarashtra