Rs 30,000 cr approved for LPG losses
*Nod to budget for MERITE
NEW DELHI, Aug 8: The Union Cabinet on Friday approved a subsidy of Rs 12,000 crore under the Pradhan Mantri Ujjwala Yojana (PMUY) for 2025-26, benefitting 10.33 crore households.
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PMUY was launched in May 2016, to provide free LPG connection to adult women from poor households across the country. As on July 1, there are about 10.33 crore PMUY connections in India.
“The Union Cabinet chaired by Prime Minister Narendra Modi, has approved the targeted subsidy of Rs 300 per 14.2 kg cylinder for up to 9 cylinders per year (and proportionately pro-rated for 5 kg cylinder) to the beneficiaries of Pradhan Mantri Ujjwala Yojana (PMUY) during FY 2025-26 at an expenditure of Rs 12,000 crore,” an official statement said.
India imports about 60 per cent of its LPG requirement.
The Cabinet also approved Rs 30,000 crore LPG subsidy to State-run oil companies — Indian Oil Corporation (IOC), Bharat Petroleum (BPCL), and Hindustan Petroleum (HPCL) — to compensate for losses incurred from selling LPG at below cost over the past 15 months.
The compensation to Oil Marketing Companies (OMCs) will be paid in 12 tranches, as per an official statement.
The international prices of LPG were at high levels during 2024-25 and continue to remain high. However, to insulate consumers from fluctuations in international LPG prices, the increase in cost was not passed on to consumers of domestic LPG, leading to significant losses for the three OMCs.
Despite the losses, public sector oil marketing companies have ensured continuous supplies of domestic LPG in the country at affordable prices.
“The Union Cabinet chaired by Prime Minister Narendra Modi has approved compensation amounting to Rs 30,000 crore to the three Public Sector Oil Marketing Companies (IOCL, BPCL & HPCL) for the under-recoveries incurred on sale of domestic LPG,” the statement said.
This compensation will allow OMCs to continue meeting their critical requirements such as crude and LPG procurement, servicing of debt, and sustaining their capital expenditure, thereby ensuring uninterrupted supply of LPG cylinders to households across the country, it added.
The distribution of the compensation within the OMCs will be done by the Ministry of Petroleum and Natural Gas.
“This step also underlines the Government’s commitment to protect consumers from volatility in global energy markets while maintaining the financial health of these PSU OMCs,” the statement said.
The Union Cabinet also approved the proposal for the implementation of the Multidisciplinary Education and Research Improvement in Technical Education (MERITE) scheme in 275 technical institutions comprising 175 engineering institutions and 100 polytechnics, Union minister Ashwini Vaishnaw announced.
It is a Central sector scheme with a total financial implication of Rs 4,200 crore for a period from 2025-26 to 2029-30.
Out of Rs 4,200 crore, there will be an external assistance of Rs 2,100 crore from the World Bank as a loan.
“An estimated 275 government and government-aided technical institutions are expected to be selected and supported under the scheme. This will include selected National Institutes of Technology (NITs), State Engineering Institutions, Polytechnics and Affiliating Technical Universities (ATUs).
“Apart from this, the State and UT (Union Territory) departments handling the technical education sector will also be supported through MERITE scheme. Further, about 7.5 lakh students will be benefitted from the scheme,” an official statement said. (PTI)
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