The government will extend a one-time grant of Rs.22,000 to three state-run fuel retailers to cover for losses incurred on selling LPG below cost in the last two years, news agency PTI quoted Union Minister Anurag Thakur in a report on Wednesday.
The grant was approved by the Union Cabinet headed by Prime Minister Narendra Modi in a meeting held on Wednesday, the report mentioned.
IOC, BPCL and HPCL to Receive the Grant
The three oil PSUs are Indian Oil Corporation (IOC), Bharat Petroleum Corporation Ltd (BPCL) and Hindustan Petroleum Corporation Ltd (HPCL).
The three firms sell domestic LPG at government-regulated prices to consumers.
Grant For LPG Losses Between June 2020 and June 2022
The grant will be for covering the losses they incurred on selling LPG below cost to consumers from June 2020 to June 2022, according to the report.
“Between June 2020 to June 2022, the international prices of LPG soared by around 300 per cent. However, to insulate consumers from fluctuations in international LPG prices, the cost increase was not fully passed on to consumers of domestic LPG,” the report stated quoting an official statement.
Accordingly, domestic LPG prices have risen by only 72 percent during this period, the statement read, adding, this led to significant losses for the three firms. “Despite these losses, the three PSU OMCs have ensured continuous supplies of this essential cooking fuel in the country.
The government has therefore decided to give a one-time grant to the three PSU OMCs for these losses in domestic LPG,” the news agency further quoted the official statement.
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