Additional 3 crore free LPG connections to cost Rs 4,800 cr

New Delhi: As many as 3 crore additional free cooking gas (LPG) connections will be given to poor households by March 2020 at an extra expense of Rs 4,800 crore, Oil Minister Dharmendra Pradhan said on Thursday.

The Pradhan Mantri Ujjwala Yojana (PMUY) was launched in May 2016 with a target to give 5 crore LPG connections to poor women in three years. Already, 3.36 crore connections have been given.

Briefing reporters on the decisions taken by the Cabinet at its meeting last evening, Pradhan said the 5 crore connections were to be given by 2018-19 fiscal year end and total Budgetary allocation made was Rs 8,000 crore.

Now, the scheme has been extended by one year and 3 crore more connections are to be given for which Rs 4,800 crore has been provided, he said.

Under the scheme, the government provides a subsidy of Rs 1,600 to state-owned fuel retailers for every free LPG gas connection that they install in poor rural households. This subsidy is intended to cover the security fee for the cylinder and the fitting charges.

The beneficiary has to buy her own cooking stove. To reduce the burden, the scheme allows beneficiaries to pay for the stove and the first refill in monthly instalments. However, the cost of all subsequent refills has to be borne by the beneficiary household.

Pradhan said till now the connections were given based on the 2011 Socio-Economic Caste Census (SECC) but now the list has been expanded to include providing free cooking gas connection to all SC/ST households, forest dwellers, most backward classes, inhabitants of islands, nomadic tribes, tea estates and beneficiaries of Pradhan Mantri Awas Yojana and Antyodaya Yojana.

He said a study of 2 crore out of the 3.36 crore PMUY beneficiaries has revealed that 80 per cent has ordered refills after getting LPG connections. Against the national average of 7 refills of 14.2-kg cylinder used by households in a year, the PMUY beneficiaries are consuming 4.07 bottles, he said.

"This is a very encouraging consumption trend," he said.