Special: Aadhaar spikes up LPG chaos

Thiruvananthapuram: While the state government claims issues relating to LPG cylinder distribution have been solved, the confusion over the price of the cylinders continues.

Gas distribution workers affiliated to  CITU  boycotted the distribution on Thursday in view of the uncertainty on the price of LPG cylinders and other gas distribution workers affiliated to various labour unions decided to hold protest marches and sit-ins before the IOC plant on January 8 demanding an end to the ‘looting’ by the oil marketing companies.

All-India LPG Distributors' Association, Kerala Circle General Secretary, M Sangeeth Kumar however, says oil companies cannot change the centralised software for shifting from the non- Aaadhaar linked scheme to the Benefit Transfer of LPG Subsidy (DBTL) scheme merely on the basis of a statement by Civil Supplies Minister, Anoop Jacob and need a written directive from the Union Petroleum Ministry.

“The price of domestic cylinders is now  Rs 1293.50. The consumers will have to pay the entire price at the time of delivery,” he explains, adding that  DBTL requires LPG consumers to seed their Aadhaar numbers with their respective LPG consumer ID and bank accounts to allow direct transfer of subsidy for each cylinder to their bank accounts for nine cylinders a year.

Petroleum Minister, Veerappa Moily  also clarifies that with the deadline for linking the scheme to Aadhar  having been extended to February 28, for Kerala, those who haven’t so far linked Aadhar to their LPG accounts can get their quota of nine cylinders at the present price.

So far only 57.27 percent of the consumers in the state or 31 lakh of the  72 lakh consumers have  linked their LPG connections to Aadhar, according to sources.

Consumers who want to link their LPG connections to Aadhaar will have to apply in a prescribed form or through the Internet and submit  a copy of their Aadhaar cards to the concerned gas agency and bank.

To get an Aadhaar they must visit an authorised enrolment centre anywhere in the country with proof of  identity and address and go through a document verification process besides having their fingerprints and iris scanned.

A 12-digit unique identification number will be delivered in 60 to 90 days to their address through speed post after a verification of biometrics and demographic data by a centralised system, which ensures deletion of duplicate data and storing of only one copy.

Next: Bottling plants freeze LPG filling operations

Bottling plants freeze LPG filling operations

Thiruvananthapuram: Utter confusion prevailed in the LPG market on Thursday with the bottling coming to a standstill, in various bottling plants, as gas agencies refused to accept loads.

LPG Employees Congress State secretary, Parippally Vinod, told Deccan Chronicle that the gas agencies had asked the bottling plants to discontinue their supply following the confusion over the price.

Soon, the supply of not only subsidized cylinders, but also non-subsidy cylinders came to a standstill.

Though the   State Government had claimed that there was no hike in LPG price for subsidized cylinders, gas agencies stuck to their stand that they have received intimation from oil companies affecting a price hike of Rs 230 for domestic cylinders.

‘The Indian Oil Corporation has the highest share of connections in the State market for LPG gas, with the company owning about 53 per cent of the connections. The company has three bottling plants, Udyamperoor, Kollam and Kozhikode.

Apart from this, the Bharat Petroleum and Hindustan Petroleum have one bottling plant each. The Parippally plant supplies 36,500 LPG cylinders in 110 Lorries daily.

Next: 3-day flutter causes backlog of 10 days

3-day flutter causes backlog of 10 days

"There are 420 gas agencies for IOC, BPCL and HPCL across the state and all except those in Pathanamhitta and Wayanad districts have been hit in the confusion. There will be an additional delay of 10 days in LPG delivery to domestic and commercial users as things stand now. If the issue is not resolved at the earliest, this will be extended to more days," Venugopal said.

Wayanad and Pathanamthitta had changed over fully to the Aadhar regime in November and hence there is no confusion on that score.

“Wehave shut down the systems and are no longer making any entry. Unless and until the confusion is cleared, we cannot proceed. Our computer network system was altered to allow only Aadhar linked subsidy by December 31. Now it has to be changed again if the information about the new deadline coming in is correct. We are yet to get any official information on extension of deadline to February end," Venugopal said.

Next: Delivery boys at the brunt end of deal

Delivery boys at the brunt end of deal

Kochi: The ones most disgruntled by the increase in the price of LPG cylinders after the consumer, is the 'delivery boy', so called even though many of them have crossed middle age. With the price going up, customers are unlikely to give them the customary tip for delivering the cylinder.

"Some customers give a handsome tip when we deliver the cylinder. But with the rate increase, they don't look too happy, even though they know that the subsidy amount will be credited to their account. Some of them plainly tell us that they can't shell out more as a tip," said Balakrishnan who works with a gas agency in Kochi.

"In the case of non-subsidised cylinders, the customers are furious and we don't expect them to treat us decently. We are afraid they will turn their fury on us in their mood of frustration," said Vineesh, another delivery boy.

Next: Government should reconsider: Vayalar Ravi

Government should reconsider: Vayalar Ravi

New Delhi: The decision to hike the price of non-subsidised LPG today triggered opposition from within the government with senior minister Vayalar Ravi seeking its reconsideration.

"It is quite natural that people will protest against this decision. Government should think about a solution to address the people's concern," Ravi told reporters on the sidelines of a function here.
He was responding when asked about the decision yesterday to effect a steep hike of Rs 220 per cylinder of non-subsidised LPG. Ravi said he will convey his sentiment to Oil and Petroleum Minister Verappa Moily.

This is the third increase in non-subsidised LPG rates in the past month. The price was hiked by Rs 63 a cylinder to Rs 1,017.50 on December 1. It was increased by a further Rs 3.50 to Rs 1,021 on December 11, when the government raised the commission for LPG dealers and distributors. 

Asked about the order of the Supreme Court that Aadhaar card should not be linked to subsidies, Ravi replied, “how can we bypass the Supreme Court? Moily is a good lawyer and he knows all legal aspects,” he said.

Next: ‘Under recovery’ results in price hike

‘Under recovery’ results in price hike

K.P. Sethunath | DC

Kozhikode: The debate on pricing of petroleum products in the country is invariably linked to what is called the ‘under recovery’ of the public sector oil marketing companies.

The concept of under recovery is a term that needed deconstruction for any meaningful understanding of the pricing of petroleum products including LPG, the main fuel for cooking in urban India.

The Union Government had deregulated petroleum prices in 2010 based on the report submitted by a high power committee headed by noted economist Kirit Parekh in 2010.

The main thrust of the Parikh Committee report was on how to bring down the rising under recoveries of the oil marketing companies leading to huge outflow from the Government exchequer in the form of subsidies.

The difference between the input cost of raw material and selling price of the finished product can be taken as the simple definition of under recovery.

The lineage of the term under recovery can be traced to the days of administered price mechanism for petroleum products and the under developed refining capacity in the country.

Refining capacity in the country was much lower than the actual demand of petrol, diesel and other goods till the early 1980s.

In those days these commodities were sold to the retail consumer at a price fixed by the Government under the system of APM.

The Government used to pay the differences between the imported cost and the prices at which it was sold in the domestic market.

But by the end of the 1990s there was no need for the country to import petrol and diesel directly as refining capacity was in excess of the domestic demand.

According to the latest estimate the country has a 35 per cent excess refining capacity as against the domestic demand.

Although the refining capacity moved up, the pricing system of the Government for the petroleum products sold in the country continue to be based on the old formula known as ‘import parity price’.

Although several expert groups appointed by the Government including the C.Rangarajan Committee (presently a member of the Prime Minister’s economic advisory council) had called for a rethinking on the subject, the import parity price regime continued to rule the roost in shaping the price of petroleum products.   

Surya P.Seth, a former principal advisor (energy) of the Planning Commission also advocated complete reappraisal of the import parity price mechanism.

In a critical evaluation of Parikh Committee report made in 2010, Sethi had pointed out that the methods adopted by the Parikh Committee would not help in addressing “the problems of petroleum pricing in their entirety and appear to be driven by the desire to allow private sector refiners, originally set up for export of products, an entry into the domestic market under the garb of liberalising price of petrol and diesel”.                  

Next: HC dismiss plea against aadhaar link to LPG

HC dismiss plea against aadhaar link to LPG

Kochi: Kerala High Court on Thursday dismissed a plea seeking a directive to the center not to insist on linking Aadhar card with banks for getting subsidies for LPG cylinders.

The petitioner Rosy Arackal a resident of Kochi pointed out that the Supreme Court had already ordered that Aadhar card should not be a basis for granting subsidy to LPG consumers.

Court dismissed the plea as withdrawn.

According to the petitioner, Adhar card can be insisted only on passing an Act by the parliament.

Ministry of Petroleum of Natural Gas has no authority to issue a circular in this regard, she argued.