Kochi:: Even as there erupt protests over LPG price-hike, the pricing formula followed by oil companies continues to remain dubious. In its latest hike, the govt announced a 50-rupee hike in both subsidised and non-subsidised category per domestic cylinder. The hike follows a strange pattern where price of non-subsidised cylinders are lowered when international prices go down and prices of both - subsidised and non-subsidised category - are upped when global prices rise.
Subsidies were introduced into the system so LPG remained affordable for the common man. Consumers get subsidy on 12 cylinders annually in keeping with the scheme. And, how is pricing done in case of non-subsidised cylinder ? That’s s a question the govt and oil companies refuse to answer despite being asked via RTI. The formula that sets base price of the non-subsidised cylinder too remains mystery. Incidentally, the centre upped the LPG prices once the Bihar election results were out.
Put together, all these raise serious doubts whether the privatisation of oil companies is meant to get rid of subsidies altogether. After all, private oil companies will never accept that kind of burden on themselves. BPCL is the first to go under privatisation and the govt. maintains stiff silence on what happens to subsidies once BPCL falls into private hands.
Efforts are on to allocate BPCL’s subsidy customers to IOC and HPCL so a subsidy-free company can be showcased to potential buyers. In effect, the centre is looking to save Rs 20,000 crores annually, if it can somehow get current subsidies off its neck.
