Govt grants Rs 22,000 crore to oil PSUs to cover LPG losses

New Delhi, Oct 12: In a major relief to public sector oil marketing companies, the government on Wednesday approved an outlay of Rs 22,000 crore to three state-owned fuel retailers to cover for the losses they incurred on selling LPG below cost to consumers from June 2020 to June 2022.

The Union Cabinet approved the one-time grant to three oil marketing companies - 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.

"Between June 2020 and 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," an official statement said.

Accordingly, domestic LPG prices have risen by only 72 per cent during this period, it said 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,'' it said.

The Union Cabinet approved a one-time grant amounting to Rs 22,000 crore to the three oil marketing companies (OMCs).

"LPG prices are increasing across the world. One-time grant of Rs 22,000 crores has been given to Oil Marketing Companies of Public Sector Undertakings so that the burden of rising prices does not fall on common people," said Union Minister Anurag Thakur

''This decision will help the PSU OMCs to continue their commitment to the Atmanirbhar Bharat Abhiyaan, ensuring unhindered domestic LPG supplies and also supporting the procurement of Make in India products,'' he added.

Highlights of cabinet decision

Productivity linked bonus of Rs 1,832 crores will be given to 11.27 lakh employees of railways. It will be a bonus of 78 days and Rs 17,951 will be its maximum limit.

Union Cabinet has approved the Multi-State Cooperative Societies (Amendment) Bill, 2022 which seeks to amend the Multi-State Cooperative Societies Act, 2002. It will incorporate the provisions of the 97th Constitutional Amendment.

Cabinet approves new Scheme "Prime Minister's Development Initiative for North East Region (PM-DevINE) for the remaining four years of the 15th Finance Commission from 2022-23 to 2025-26.

Narendra Modi Government has approved a onetime grant of Rs. 22000 Crores to public sector oil marketing companies (OMCs).