Home / Politics / Policy /  Cash transfers for LPG cylinders to cover 269 districts by January

New Delhi: Making more populist announcements in an election year, the government on Thursday said it will extend the direct benefits transfer (DBT) programme for cooking gas connections to another 269 districts by January.

The programme, also called Aap Ka Paisa, Aap Ke Haath (your money in your hands), is being billed as ensuring effective delivery of cash payments to beneficiaries and eliminating pilferage in government welfare programmes.

The announcement comes in the same week that the Congress party-led United Progressive Alliance (UPA) government got the food security and the land acquisition laws passed in Parliament.

The government launched the DBT programme as a pilot in 20 districts for 26 schemes starting 1 January, to transfer cash subsidies and welfare payments using Aadhaar directly into the bank accounts of the beneficiaries.

Aadhaar is a unique digital identity number being issued to all residents in India and bank accounts of beneficiaries are being linked to it for them to receive the subsidies.

Based on a good response to the pilot project, the cabinet committee on economic affairs (CCEA) decided to rapidly roll out DBT for cooking gas subsidies in a little less than half of the country, finance minister P. Chidambaram said in a press briefing on Thursday.

Starting 1 September, DBT for subsidies on liquefied petroleum gas (LPG) cylinders will be rolled out in 34 districts, while the remaining districts will be added to the programme in phases by 1 January 2014.

India has about 140 million consumers of subsidized cooking gas cylinders.

Chidambaram said for beneficiaries without bank accounts, it will be the joint responsibility of banks and oil marketing companies to prod customers to open banks accounts. “The bank managers will be responsible to seed Aadhaar numbers into the bank accounts," Chidambaram said. Consumers will have a three-month grace period to link their Aadhaar numbers with their bank accounts.

Bank account “seeding" with Aadhaar is seen as a bottleneck to rolling out direct transfer of cooking gas subsidies to customers faster.

The finance ministry had set 30 August as the deadline for banks to match the levels of Aadhaar coverage (about 75%) of beneficiaries in the 20 districts in the first phase. The DBT mission under the finance ministry will review the progress of linking of bank accounts with Aadhaar numbers on Friday.

The expansion of the DBT programme cannot be seen in isolation of the ensuing Lok Sabha election scheduled for next year, said N. Bhaskara Rao, a political analyst.

“Cooking gas is a critical component and it is a natural sequential progression. Both the food security Bill and DBT are aimed at elections, otherwise why would they have to wait for so long," Rao said. “However, this hastiness may only lead to a boomerang effect where you take such steps in haste resulting in implementation not being perfect."

The CCEA on Thursday approved the continuation of the technology upgradation fund scheme (TUFS) for the textile industry during the 12th Five-Year Plan period that ends on March 2017, with a major focus on powerlooms, in accordance with an announcement in the national budget for fiscal 2014.

The total budget outlay to continue the scheme will be about 11,900 crore, of which 2,400 crore has been allocated for the year to March.

The CCEA also approved continuing the ground water management and regulation scheme with new components of aquifer mapping and participatory ground water management. The scheme involves an expenditure of 3,319 crore during the 12th Plan period. It will be implemented in 28 states and seven Union territories, covering 889,000 sq.km.

In addition, the cabinet has approved a social security agreement with Canada’s Quebec province, which is expected to benefit around 40,000 residents of Indian origin. It also decided to include two communities, one each from Chhattisgarh and Tamil Nadu, to the Scheduled Tribe list.

Anuja and Kirthi V. Rao contributed to this story.

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