JOIN USThe price of domestic LPG cylinders has been cut by Rs 6.55 in Karnataka. A 14.2-kg cylinder now costs Rs 408.
The reduction comes in the wake of recalibration of prices by the oil marketing companies (OMCs) after the government failed to implement the scheme launched in 2003 to compensate them for the irrecoverable state taxes, and the oil companies suffered huge losses.
The rates of domestic cooking gas have also been cut by Rs 10.18 per cylinder in Gujarat, Rs 7.01 in Tamil Nadu, Rs 3.86 in West Bengal and Rs 4.15 in Odisha. It costs Rs 405 in Kolkata and Rs 393.50 in Chennai.
The new readjustment exercise by OMCs has benefitted some other states like Andhra Pradesh, Madhya Pradesh, Goa, Jharkhand, Punjab and Tripura. But, there will be no change in rates in Delhi where a cylinder costs Rs 399.26.
The rates have gone up by Rs 19.43 in Assam, Rs 9.16 in Bihar and Rs 8.72 per cylinder in Maharashtra after the recalibration.
The government has made a provision for Rs 40,000 crore in this year’s budget for fuel subsidy and upstream oil companies will provide Rs 68,220 crore.
The two combined, however, still leaves a gap of Rs 71,780 crore. Market watchers say, with stubborn inflation running over seven per cent, and a weakening rupee in the past many months, there is no other option, but to go in for such measures to adjust fuel prices.