Aimed at providing LPG (cooking gas) connections to 5 crore below-poverty-line (BPL) beneficiaries over the next three years, Prime Minister Narendra Modi on May 1 launched the Rs. 8,000 crore Pradhan Mantri Ujjwala Yojana (PMUY) scheme to provide 5 crore LPG connections to Below Poverty Line (BPL) families in the next three financial years.
Talking about PMUY, Modi said this scheme is being funded in part from savings from over 1 crore ‘well-off’ cooking gas users voluntarily giving up their LPG subsidy. The “Give it up” initiative was first rolled out a year ago on March 27th, 2015.
The Scheme provides financial support of Rs 1600 for each LPG connection to BPL households, who would be identified as per the SECC data. This Scheme would be implemented over three years, namely, the FY 2016-17, 2017-18 and 2018-19. This is the first time in the history of the country that the Ministry of Petroleum and Natural Gas would implement a welfare scheme benefitting crores of women belonging to the poorest households.
“Over 1 crore consumers have given up their subsidy leading to a savings of nearly Rs 2000 crore per year. This money would thus be utilised to provide LPG connections to families Below Poverty Line. My compliments to Mr. Dharmendra Pradhan and the entire Ministry of Petroleum & Natural Gas for working on mission mode on this initiative and making it such a grand success”, said the Prime Minister.
Elaborating on the PMUY, Modi said that over 5 crore BPL women would be provided LPG connections in the next three years, without having to pay any security deposit. While the administrative cost of Rs. 1600 per connection, pressure regulator booklet and safety hose would be borne by the Government, consumers would have the option to purchase gas stove and refills on EMI.
To cater to this increased demand for LPG, nearly 10,000 new distributorships and adequate infrastructure expansion plans are in the pipeline, which will lead to improved employment opportunities for the youth.
Consumers are currently entitled to 12 cylinders of 14.2 kg each or 34 bottles of 5 kg each in a year at subsidised rates. Customers pay the non-subsidized price for LPG refills, while the subsidy element is transferred directly to their bank accounts under the Pahal initiative. The Pahal scheme has helped cut the government’s subsidy bill on LPG by Rs.15,000 crore. Subsidy saving of around Rs. 1200 crore has been achieved through the “Give It Up” campaign and is being used to provide LPG connections to the poor under the ‘Give back’ scheme. A total of 2.03 crore LPG connections were released in 2015-16, of which over 50 lakh were to BPL families.
Significance of PMUY: The scheme is expected to usher in significant benefits for the country:
It will increase usage of LPG thus reducing health disorders due to usage of polluting conventional cooking fuels like wood, cowdung, etc.
It will reduce air pollution caused by smoke from solid fuel usage in kitchens
It will ensure reduced deforestation and cutting down trees for firewood.
Creating a smoke-free rural India:
In India, the poor have limited access to cooking gas (LPG). The spread of LPG cylinders has been predominantly in the urban and semi-urban areas with the coverage mostly in middle class and affluent households. But there are serious health hazards associated with cooking based on polluting fuels.
According to WHO estimates there are about 5 lakh deaths in India alone due to polluting cooking fuels. Indoor air pollution is also responsible for a significant number of acute respiratory illnesses in young children. According to experts, having an open fire in the kitchen is like inhaling smoke from 400 cigarettes per day.
Providing LPG connections to BPL households will ensure universal penetration of cooking gas in the country. This measure will empower women and protect their health. It will reduce drudgery and the time spent on cooking. It will also provide employment for rural youth in the supply chain of cooking gas.
Infrastructure strengthening: The demand of LPG is expected to rise in double digits with new connections provided under the PMUY. India currently has 16.64 crore active LPG consumers with a requirement of about 21 million tonne per annum LPG requirement.
The 3 public sector Oil Marketing Companies have approved plans to expand rated LPG bottling capacity from the present over 15,000 thousand metric tonne per annum (MTPA) by around 10% by the end of FY 17-18, so as to meet the expected increase. Plans are afoot to expand import facilities to meet the enhanced LPG demand in the country.
While IndianOil is developing new import facilities at Dahej ( by 18-19), Paradip and Cochin ( by 17-18), BPC is developing its import facility at Haldia, apart from which East India Petroleum Private Limited (EIPL) capacity augmentation is also getting completed by Dec. 2016.
In addition, the private sector is also working towards adding import infrastructure to facilitate LPG imports.
LPG Distributorships : The MoPNG under Pradhan has already announced that distribution system will be further strengthened to ensure catering to people’s demand especially in remote areas. The minister has directed OMCs to ensure reliable, sustained last mile supply and effective monitoring and redressal mechanisms to ensure targeted delivery and effective implementation. He also said that 10,000 new LPG distributorships have been planned during the next 3 financial years to expand the coverage area.
Further, one officer from the public sector Oil Marketing companies would be appointed as coordinator for each of the country’s 674 districts to augment the penetration of LPG in the country.
With 2016 being declared as the ‘Year of Consumers’ by Pradhan has ensured that Oil Marketing Companies (OMCs) offer customer centric offereings like Sahaj – the online booking and release of new connections, the online booking and payment for LPG refills, ‘1906’- the 24×7 LPG leakage Emergency telephone helpline, to name a few.
The aim is to achieve the ambitious target of converting an additional 10 crore households (of which 5 crore would be BPL families) to LPG usage by the end of 2018.