Govt to roll out direct benefit transfer scheme for kerosene from 1 April
Pilot project to check diversion of fuel for adulteration of diesel, ensure subsidy reaches intended recipients to be rolled out in 26 districts
New Delhi: To check the diversion of kerosene for adulteration of diesel and ensure the subsidy on the fuel reaches the intended recipients, the benefit will be transferred directly to the bank accounts of customers in 26 districts from 1 April, the oil ministry said on Friday.
The ministry said the quantum of subsidized kerosene allocated to states this fiscal at 86.85 lakh kilolitres was way above the total annual consumption of kerosene—subsidized and otherwise—of 71.30 lakh kilolitres as indicated by the National Sample Survey 2011-12. Besides, actual consumption has declined further since then.
“Thus, there is evidence that some part of the kerosene allocation is diverted for non-eligible purposes,” the ministry said.
With the electrification of more villages, the demand for kerosene for lighting purposes is on the decline.
Also, the “GiveItUp” campaign of the government had seen nearly 4.5 million new liquefied petroleum gas connections going to the poor.
The 26 districts for the pilot project have been identified across eight states--Chhattisgarh, Haryana, Himachal Pradesh, Jharkhand, Madhya Pradesh , Maharashtra, Punjab and Rajasthan.
Where such transfer is introduced, the consumer will pay the un-subsidized price of kerosene at the time of purchase. Subsequently, the subsidy will be directly transferred to the bank account of the beneficiary.
To avoid any inconvenience to the beneficiaries at the time of purchase, the subsidy will be credited in advance.
To encourage more states to join the scheme, the central government will give a cash incentive of 75% of the subsidy savings to states during the first two years, 50% in the third year and 25% in the fourth year.
In case the states voluntarily agree to undertake cuts in kerosene allocation, a similar incentive will be extended to them, based on savings in cost to the central government.
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Business NewsPoliticsPolicyGovt to roll out direct benefit transfer scheme for kerosene from 1 April
First Published:1 Jan 2016, 10:57 PM IST
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