New Delhi: After the retail traders, over 10000 LPG distributors are now up in arms against the government. They are threatening to first go on a one day token strike on Oct 1 and if that does not help their cause, a longer strike may follow. Should that happen lakhs of households across the country will get disturbed over something that matters most to India — home cooked food.
The Union Government’s decision to put a cap on six subsidized cylinders per year and three in the remaining part of the current financial year has brought a series of accounting and distribution problems. There are valid reasons to believe that black marketing of LPG cylinders would start peaking in a month-and-half when the LPG rationing of three for the current financial year starts ending in different households. It could unleash a trail of law and order problems as well.
Besides households, there are problems on other fronts too. There is no clarity if the ration exists for these key areas – police, jail and mid-day meal scheme. General Secretary of National Federation of LPG Distributors of India (NFLDI), Pawan Soni asks which distributor would have the courage to refuse a cylinder to a policeman. It’s well known that they get delivery of as many cylinders as they want at short notices. One can’t foresee a situation where policemen suddenly start behaving and start paying market de-control price of Rs 800. Who will pay for that loss? A distributor is going to be under tremendous stress to his or her business safety and security.
As per estimates, a good number of households will consume the quota of three cylinders for the current financial year in the next two months. After the cap ends the market would see the existence of dual or triple price mechanism. After the cap, the individual households will have to pay around Rs 800 per cylinder.
The problem starts from there. Soni says no consumer is going to pay Rs 800 without ensuring that cylinder weighs 14.2 kg accurately on the weighing machine and they would fight it out with the distributors in case it weighs less.
Further, the issue of a proper seal is a long pending demand before the government. The current seal can be tampered with great ease. It is also common knowledge that pilferage in cylinders takes place at various stages and most smaller cylinders, used by those in the BPL category and in small tea shops in hinterland get refilled 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 receipt is there but what if a consumer contests delivery. Whose word shall prevail, the dealer or the consumer? There could be too much of fight at ground, which the government may not have anticipated.
The LPG distributors are making demands that appear simple – uniformity in pricing and uniformity in rationing in numbers of cylinders and putting a new seal that could not be tampered. 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, which each delivery boy gets for handling and other logistical costs. The new rationing system devised by the government would require too much of accounting and book keeping.
The government is unlikely to agree to their demands for uniformity in cylinder pricing, a in hike the prices without putting a rationing cap of six or whatever. But there could be too many problems brewing on the ground, which the government may not have anticipated. Worse, it would all happen when it moves closer to elections. The politics on anger over disruption of `Ghar Ka Khana’ (home food) will be difficult to be calmed down by economics on calculations of fiscal deficit may not be able to bridge.