The six-cylinder solution to cooking gas subsidies is proving to be more trouble than anticipated.
Reason: what was meant to be a simple scheme—just six cylinders a year per family—has gotten more and more complicated in its implementation. While the basic entitlement is six cylinders, some Congress states have offered subsidies for three more, and there is no clarity on whether some sorts of customers—those managing the mid-day meal schemes for children, for example – are entitled to more.
At the core is the accounting problem: how do you keep tabs on each user’s cylinder entitlement when there are so many categories? Also, will the states that promise subsidies for three more cylinders pay up on time?
Little wonder, India’s 10,000-and-odd LPG distributors are up in arms against the government. They are threatening to first go on a one-day token strike on 1 October and, if that does not help their cause, a longer strike may follow.
Should that happen, lakhs of households across the country will be up in arms as well as gas supplies taper off.
The Union Government’s decision to put a cap on the supply of subsidised cylinders means only three more are due in the second half of this year.
But the festival season is just beginning, and there are thus valid reasons to believe that black marketing in cylinders will start peaking from next month onwards. Gas distributors expect law and order problems as well as everybody gets mad over supplies.
Apart from regular households, problems are there on other fronts also. There is no clarity if the rationing will affect these three categories – the police, the jails and the mid-day meal scheme. Pawan Soni, General Secretary of the National Federatoin of LPG Distributors of India (NFLDI), says no distributor can afford to refuse a policeman.
It’s everyday practice that they get deliveries of as many cylinders as they want at short notice. One can’t foresee a situation where policemen suddenly start behaving and start paying market rates of nearly Rs 800 a cylinder.
Not only policemen, but distributors feel that they are going to be under all kinds of pressure from local politicians and goons, which may threaten their safety.
According to the Federation’s estimates, households will consume the quota of three cylinders for the current financial year in the next two months’ time. Once the cap is breached, there will be dual or triple price mechanisms.
The problem starts from there. Soni says no consumer is going to pay Rs 800 without ensuring that the cylinder weighs 14.2 kg—which means they will be more firm on ensuring they don’t get gypped at least on weight. The issue of proper sealing is a long-pending demand before the government.
The current seal can be tampered with easily. It is common knowledge that pilferage takes place at various stages and most smaller cylinders, used by below poverty line beneficiaries, and small tea shops in the hinterland obtain refills from regular cylinders through some locally innovated mechanisms.
NFLDI says there is no mechanism to prove that a consumer has finished his quota of rationed cylinders. While signed receipts are there, if a consumer contests delivery, there could be a problem. This can happen in a situation where cylinders are routinely given out of turn to some users for a small payment to the delivery man.
The LPG distributors are making demands that appear simple —uniformity in pricing and uniformity in rationing cylinders and putting a new tamper-proof seals. They say that for a commission of Rs 25.83 per cylinder the consequent risks now would be too much to handle, unless the government takes remedial action. This commission is inclusive of Rs 8 for delivery.
The government is unlikely to agree to their demands for uniformity in cylinder pricing and rationing. But there are many problems brewing on the ground, which the government may not have anticipated. Worse, it could all happen when elections draw closer. The politics on anger over disruptions in kitchen economics will be difficult to calm down in the months ahead unless better solutions are found.