Subsidy on domestic LPG,kerosene to continue: Govt

“In view of importance of the household fuels,namely PDS,kerosene and domestic LPG (Liquefied Petroleum Gas),the Government has decided that the subsidies on these products will be continued”,Meena said in a written reply in Rajya Sabha.

As per the wholesale price index (WPI),inflation in mineral oils increased to 16.7 per cent in January,from 7.9 per cent in the corresponding period last year.

“This is mainly because of rise in crude oil prices (Brent) in international market,which rose to USD 96 per barrel in January 2011,from USD 77 per barrel in January 2010,and USD 45 per barrel in January 2009”,Meena said.

Weight of mineral oils in WPI was 19.7 per cent in January compared to 9 per cent in the same month last year.

The PDS,kerosene and domestic LPG scheme 2002 as well as freight subsidy (for far flung areas) scheme 2002 have been extended till March 2014.

In reply to another question,the minister said the Government monitors the price situation regularly as “price stability remains high on the agenda”.

Food inflation dipped to 9.3 per cent in January 2011 after rising to a high of 20.2 per cent in February 2010. The headline inflation was 8.23 per cent in January.

While presenting the Union Budget yesterday,Finance Minister Pranab Mukherjee said the Government will move towards direct transfer of cash subsidy in a phased manner.

A task force headed by UIDAI Chairman Nandan Nilekani is working out the modalities for the proposed system of direct transfer of subsidy for kerosene,LPG and fertilizers.