Absence of proper mechanism may hit gas cylinder delivery, say distributors

The Government may have to take some quick decisions if it wants smooth delivery of domestic LPG cylinders.

The All India LPG Distributors’ Federation today said that if the Government and the oil marketing companies fail to come up with a proper enforcement mechanism by the month-end, then effective October 1, the distributors would be left with no option but to resort to direct action, including stoppage of home delivery.

This comes in the backdrop of the recent Government decision that restricts the supply of subsidised domestic LPG to six annually for each household.

Pratap Doshi, President of the Federation, said the main executants of the scheme, the distributors were not taken into confidence to ensure that there are no loopholes in the system. “Till a system is not in place, the Government should consider keeping the decision in abeyance,” he said at a press conference here.

Doshi said that a dialogue is going on with the Petroleum & Natural Gas Ministry.

The distributors had met the Petroleum & Natural Gas Ministry officials on Monday. The Ministry, however, is of the view that it is a learning process for all, and that the distributors must cooperate.

The distributors fear that identification of beneficiary domestic customers in the existing system and procedures, without any IT features such as binary or finger print check is not possible.

“It will not be possible to establish genuineness of delivery to the right customer, as it is very easy to pay a measly tip to the delivery boy and collect someone else’s cylinder,” Doshi explained.

LPG pricing: Besides, the issue of pricing is also there. With this announcement, there will be three different LPG price slabs in the country – 14.2 kg (domestic) subsidised cylinder rates, 14.2 kg market price, and 19 kg (commercial) cylinder price.

Doshi said as it is the distributors were under pressure of dual pricing, and with this introduction of third price, the so-called ‘menace of diversion’ will only increase.

The federation was told by the Ministry on September 17 that by the evening, the Government will announce the market-determined retail selling price for non-subsidised domestic LPG. However, this has not happened as yet, adding to the logistical problems for the networks, Doshi said.

Suggestions: The federation has suggested that the Government could consider a uniform price – a single non-subsidised price. Subsidy should be transferred to customer’s bank account by the oil marketing companies or the Ministry.

The present 14.2 kg cylinder should be sold at market determined price, while the oil companies should introduce 5 kg domestic refill for subsidised cylinders.

This can be at the rate of three every two months or 18 cylinders x 5 kg annually per customers (5 kg x 18 cylinders works to 90 kg against the proposed 14.2 kg x 6 cylinders with is 85.20 kg).

Besides, the delivery schedule for the subsidised cylinder and pilfer-proof seal need to be put into place before the decision on capping is implemented, Doshi said.