Centre sets up committee headed by Kirit Parikh to review LPG marketing

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After increasing the penetration of liquefied petroleum gas (LPG) over the last four years, the Ministry of Petroleum and Natural Gas is now looking to review the existing structure of LPG marketing in India — a move seen as an effort to bring in more private players.

To review the existing marketing structure, the Centre has set up a five-member committee headed by economist Kirit Parikh.

Based on the LPG (Regulation of Supply and Distribution) Order, 2000, private players are eligible to operate as parallel marketeers of LPG.

The new committee, set up on May 30, will look into issues related to definition or quality standards of LPG being marketed. Its terms of reference also include scope for liberalising government policies for private participation. The committee is expected to submit its report by end-July. Based on the LPG control order, domestic LPG should be supplied to oil-marketing companies (OMCs) only. Later in 2015, Reliance Industries had stated in an investor presentation that it has forayed into cooking gas retailing, by launching a 4-kg LPG cylinder on pilot basis in four districts.

As of April 1, the LPG coverage in India was seen at 94.3 per cent, up from 56 per cent in 2014. The three OMCs — IOC, Bharat Petroleum Corporation, and Hindustan Petroleum Corporation —have 265.4 million active LPG customers in the domestic category, which are being served by 23,737 LPG distributors.

The success of Pradhan Mantri Ujjwala Yojana (PMUY) over the last three years was considered to be instrumental in increasing LPG penetration. Of the total 45.51 million new domestic customers enrolled by OMCs in 2018-19, 36.29 million were enrolled under PMUY.

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