Under-realisation on selling domestic LPG and kerosene through public distribution system is likely to be around Rs 50,000 crore (Rs 500 billion) during the current fiscal, Petroleum Minister Murli Deora said on Monday.
LPG is being sold at a loss of Rs 177 per cylinder and kerosene at a price Rs 17 per litre below the cost.
"In spite of substantial increase in the price of these fuels in the international market during the last three years, as advised by UPA Chairperson Sonia Gandhi, the government did not increase the price of PDS Kerosene and of domestic LPG.
"The Government and oil companies are providing subsidy of Rs 17 per litre on PDS kerosene and Rs 177 per cylinder on domestic LPG," he said at the foundation laying ceremony of the Rs 5460 crore
The United Progressive Alliance government is committed to provide kerosene and LPG at affordable prices to protect the interests of weaker sections of the society, he said indicating no move of increasing cooking fuel prices in the near future.
"In order to protect the aam adami (common man) from the unprecedented rise in international oil prices, the government is bearing the load of under recovery of Rs 50,000 crore in the present financial year," Deora said.
He lauded the prime minister for supporting the issue of oil bonds, which would partly compensate oil firms for selling fuel at subsidised rates. Oil bonds have helped maintain the financial health of oil PSUs while balancing the need to maintain affordable prices of fuels, he added.
