OMCs make provisions for PMUY losses

OMCs make provisions for PMUY losses

State-run oil marketing companies (OMCs) classified a section of loans provided to beneficiaries of the Pradhan Mantri Ujjwala Yojana (PMUY) in FY18 as ‘doubtful’ as recipients did not ask for LPG refill for a year.

While Indian Oil has made a provision of Rs 162 crore for inactive beneficiaries at the end of FY18, HPCL and BPCL have also made provisions of almost half that amount each.

Indian Oil is the leader in providing almost 50% of around 4.95 crore liquefied petroleum gas (LPG) connections released till date under the government’s flagship scheme.

“Companies have already made provision in the accounts of (FY18) for those beneficiaries who have not taken refills for at least a year. If these beneficiaries continue the trend and do not come back for refills, these provisions will be classified as bad debt,” said a source, adding that this provision has been made on auditors’ insistence. Read More

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