PMUY scheme to disburse 10 mn more LPG connections might begin by June

The Ministry of Petroleum and Natural Gas has finalised the contours of the next leg of the Pradhan Mantri Ujjwala Yojana (PMUY) and is expected to launch it next month. The Centre is aiming to disburse 10 million more liquefied petroleum gas (LPG or cooking gas) connections to lower income households in this phase.

According to officials in the know, this leg of the scheme will be similar to the existing PMUY and the eligible categories of recipients will also remain the same.

“The next leg of the scheme is ready but the implementation had to be pushed ahead a bit because of the raging Covid-19 pandemic. Since PMUY also requires door step verification of recipients, there was a higher risk of contamination. We are hoping to launch the scheme by June,” a top oil ministry official told Business Standard.

“The PMUY scheme remains the same as before,” the official added.

Under the PMUY scheme, a cash assistance up to Rs 1,600 per beneficiary for providing a new LPG connection is footed by the centre. The beneficiary bears the cost of Hot Plate (LPG stove) and purchase of first refill. To make this affordable, the beneficiary is offered a loan from Oil Marketing Companies at zero interest. The loaned amount is recovered by the oil companies through the subsidy accrued on purchase of subsequent cylinder refills by the beneficiaries.

In her February 2021 Budget speech, Finance Minister Nirmala Sitharaman had announced a fresh target to add 10 million more PMUY beneficiaries to the existing 80 million. This will take the total number of Liquefied Petroleum Gas (LPG, or cooking gas) consumers in the country close to 300 million by March 2022. There are around 207.2 million non-PMUY LPG consumers in the country.

It was earlier expected that this leg of the PMUY scheme would begin just after the Model Code of Conduct (MCC) was lifted by the Election Commission. The MCC was in force from February 26 to May 4, in light of key Assembly elections in West Bengal, Assam, Tamil Nadu, Kerala and Puducherry.

But the lifting of MCC coincided with the devastating second wave of the Covid-19 pandemic, pushing ahead the centre’s plans to implement the PMUY Budget announcement.

The implementation of the populist PMUY scheme this year also gains relevance ahead of the crucial Uttar Pradesh assembly elections due in early 2022. Uttar Pradesh already has the largest number of PMUY beneficiaries from amongst all states of the country with around 15 million existing recipients. West Bengal and Bihar come second and third at around 9 million each. Besides Uttar Pradesh, Goa, Manipur, Punjab, and Uttarakhand are also poll bound in February/March 2022.

To aid lower income households during the first wave of the Covid-19 pandemic, the centre offered three free cylinder refills to PMUY recipients under the Aatmanirbhar Bharat Package. This cost the exchequer Rs 9,670.41 crore and was transferred to PMUY beneficiaries during April to August 2020 under the Pradhan Mantri Garib Kalyan Yojana for buying the LPG refills. This pushed up the overall LPG consumption of the country while most other fuels reported a decline during 2020-2021.

States with highest number of PMUY beneficiaries (as on September 14, 2020)

State
Number of PMUY connections
Uttar Pradesh 1,47,56,494
West Bengal 88,56,695
Bihar 85,37,893
Madhya Pradesh 71,54,600
Rajasthan
63,68,525
Odisha 47,40,385
Maharashtra
44,28,682
Assam 34,84,901
Jharkhand 32,61,556
Tamil Nadu
32,41,417


Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel