9 states, 2 UTs okay kerosene cash transfer

9 states, 2 UTs okay kerosene cash transfer

Task force suggests implementation of scheme in two phases; bank accounts to be linked to Aadhar

9 states, 2 UTs okay kerosene cash transfer

Even as Prime Minister Manmohan Singh sets up a committee to expedite the implementation of direct cash transfer plan to beneficiaries of government welfare schemes, nine states and two Union territories had already given their consent for transfer of cash under kerosene subsidy.

Andhra Pradesh, Kerala, Goa, Himachal Pradesh, Rajasthan, Madhya Pradesh, Sikkim, Maharashtra and Jharkhand have agreed to adopt the scheme of transfer of cash to the beneficiaries of subsidised kerosene under public distribution system (PDS).

The Union territories of Andaman & Nicobar Islands and Pondicherry too had given their consent. 

For the remaining states, the Union Ministry of Petroleum is in the process of answering quarries raised by them on the scheme. In Karnataka, the Centre, which plans to implement it in Tumkur and Mysore districts, has sought the state government’s approval.

“As the state had raised some queries on this issue particularly on possible reduction in subsidy amount, the ministry is in the process of replying those,”, sources in the ministry told Deccan Herald.

Once all the states gave their consent, the scheme will be implemented in two to three districts in each states in the first phase.


The selection of districts will be made where 100 per cent Aadhaar enrollment and distribution of unique identify number have been completed. The ministry has successfully conducted the pilot project of the direct cash transfer in Alwar district of Rajasthan.

The scheme is being implemented based on the recommendations of a task force headed by Unique Identification Authority of India chairman Nandan Nilekani.

The task force had suggested a two-phase implementation method for kerosene subsidy scheme. In the first stage, states have to purchase kerosene from oil companies at market price. Then the subsidy can be transferred to the state governments, which will be linked to their actual kerosene off take.

In the second stage, the cash equivalent of subsidy will be transferred directly to the beneficiaries’ bank accounts which will be linked to Aadhaar. For this, states are required to open a ‘kerosene’ account for beneficiaries with Aadhaar number. The cash subsidy will again be proportional to the actual quantity of kerosene lifted by them.