In a major relief to households across the nation, the Indian Oil Corporation (IOC) has declared that the price of non-subsidised cooking gas cylinders (LPG) will be cheaper by Rs 100.50 per cylinder from Monday, July 1. With this, the non-subsidised LPG gas cylinder will be available for Rs 637 instead of Rs. 737.50.
The decision to cut rates was taken in view of softening LPG prices in the international market and a favourable dollar-rupee exchange rate, according to a press release by IOC. "Price of Non-Subsidised LPG in Delhi will decrease by Rs 100.50 per cylinder from 1st July. Upfront cash payment by consumer of domestic LPG will reduce by Rs 100.50 per cylinder," said IOC in a statement.
The release further stated: "As domestic LPG prices are subsidised by the government, the effective price has come down to Rs 494.35 per cylinder with this rate revision. The balance amount of Rs 142.65 per cylinder would be borne as subsidy by the central government and transferred to the consumer's bank account after the purchase of a refill."
The recent development, which has been welcomed by the households using LPG gas cylinders, comes days ahead of the Union Budget on July 5. The budget for the financial year ending March 2020 will be presented by Finance Minister Nirmala Sitharaman. This is also the first budget of the Narendra Modi government after BJP came back to power in a landslide election win.
However, LPG saw a price hike of 3.65 percent with effect from June 1 and the recent cut comes exactly after a month. Indian Oil said that amounted to an increase of Rs 25 per cylinder as compared to the last month. In any case, depending on changes in the average international benchmark LPG prices and foreign exchange rates, the extent of the subsidy varies from month to month.