New Delhi: After LPG, the Central government is now going to launch direct benefit transfer (DBT) of subsidy in kerosene from April 1, 2016 to ensure that genuine beneficiaries get the benefit while preventing illicit diversion.
Eight state governments including Chhattisgarh, Maharashtra, Madhya Pradesh and Punjab till now have come forward to implement DBT in kerosene in selected districts. To encourage states to launch DBT of subsidy in kerosene, the Centre on Friday announced that states will be given 75 per cent subsidy savings in first two years in cash. It will get reduced to 50 in the third year and 25 per cent in the fourth year.
If the states voluntarily agree to undertake cuts in kerosene allocation, beyond the savings due to DBT, a similar incentive will be given to them. The Centre said that in states where DBT for kerosene is launched, the consumer will pay the unsubsidised price for it at the time of purchase. Subsequently, the amount of subsidy will be directly transferred to the bank account of the beneficiary.
To avoid any inconvenience to the beneficiary through payment of un-subsidised price, subsidy will be credited to eligible beneficiaries in advance during the initial purchase. The government has decontrolled petrol and diesel prices. It has already launched DBT in LPG and scrapped LPG subsidy for those with annual taxable income of Rs 10 lakh. Kerosene was the only fuel till date in which no reform has been implemented. Subsidised ker-osene is misused to adu-lterate other fuels and it has resulted in kerosene mafia in many states. Subsidy for kerosene for the fiscal 2014-15 was around Rs 25,000 crore. For January 2016, unde-rrecovery on kerosene was Rs 9.16 per litre.
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