Government to decide on raising cap on subsidised LPG cylinders soon: Moily

Petroleum and Natural Gas Minister Veerappa Moily said on Friday a decision on raising the cap on subsidised cooking gas cylinders and increasing prices of diesel and liquefied petroleum gas (LPG) would be taken by the government soon.

He added, the government was seriously considering the recommendations of the Kelkar Committee, which proposed increasing diesel, kerosene and cooking gas rates in a staggered manner and linking diesel prices with international rates by next fiscal year.

"Expect a decision (on raising cap on subsidised LPG supply and fuel price hike) as quickly as possible," he told reporters following the announcement of the ministry's move to allow consumers to switch cooking gas distributors like cellphone users changed their service provider.

Government officials had, in the past, said that the oil ministry had proposed an increase in the cap on supply of subsidised cooking gas cylinders from six to nine, with about Rs50 per unit price hike and an increase in diesel prices by less than Re1 a litre per month to bring it on par with market prices over the next 10-15 months.

The finance ministry has been keen on reducing the subsidy burden and according to oil companies if they had sold fuel at international rates they would have gained additional revenue of Rs1.63 lakh crore in the current fiscal year.

Responding to a question as to whether the oil ministry had moved a cabinet note for raising fuel prices, Moily referred to the Vijay Kelkar Committee report, saying,
''Recommendations of the Kelkar Committee are under serious consideration.''