Bars had allied hotels which were doing brisk business consuming a lot of LPG
Indian Oil Corporation witnessed a negative growth in the commercial sector.is the period when the Direct Benefit of Transfer of LPG (DBTL) scheme and limited number of subsidy cylinders were in vogue
KOCHI: LPG and liquor may not have much in common other than being inflammable. But the commercial section of LPG cylinders of Indian Oil Corporation has witnessed an unprecedented negative growth of 10 per cent in the state in the period since April 1. The probes by the IOC officials have found out the reason: the state government’s decision to close down the bars.
A senior IOC official disclosed that the closure of 418 bars since April 1 was the prime reason for the fall in the growth of the commercial segment as these bars had allied hotels which were doing brisk business consuming a lot of LPG cylinders supplied primarily by the IOC.In the last financial year which ended on March 31, 2014, the IOC witnessed a negative growth of 1.57 percent in the commercial sector. This is the period when the Direct Benefit of Transfer of LPG (DBTL) scheme and limited number of subsidy cylinders were in vogue.
However, a senior official of BPCL, which deals with Bharat Gas, said that they had experienced a 10 per cent growth in the domestic sector when DBTL was lifted and the number of subsidy cylinders was increased to 12. In the same period, the commercial sector witnessed a negative growth of nine percent. “This is a clear indication of the diversion of subsidised domestic cylinders to the commercial sector,” he said.
After the capping of subsidised domestic cylinders was first introduced in 2012, the commercial LPG sector witnessed a growth of 17 percent while domestic LPG grew by minus three percent. “This also underscores the trend for diversion from domestic to commercial,” he said.
In the houses in Malappuram, an average of four cylinders were booked during this time. “When the DBTL was not in force, several traders were holding many blue books of domestic consumers,” he said and added that it was important to have the DBTL scheme in force to prevent diversion of cylinders. The IOC official said that diversion of subsidised cylinders to the commercial sector was a reality, but the IOC, being the market leader, is visited by other dynamics of the market also.
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