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Gaurav Sharma, a 27-year-old bank officer, is one of the few people his age to come forward when I ask on an online forum if someone has given up one's LPG subsidy. For Sharma, it is a matter of pride, unlike his sceptical peers who are on the fence about this scheme. He tells me that it was exciting to see his name in the "scroll of honour" on the website of his gas service provider. A link below that, one that lists the campaign's "champions and beneficiaries", is another feather in his cap - he knows which rural household benefitted because he chose to forego his subsidy.
Sharma is not alone in the petroleum ministry's Give It Up campaign: till the morning of July 25, 1.28 million households had given up their LPG subsidies, amounting to total annual savings of Rs 475 crore to the exchequer. This may still be small when compared to the total LPG user base of approximately 155 million, but is a success when the fact that the scheme is completely voluntary is taken into account. Also, roughly 20 million connections, or almost 13 per cent of the total, have not signed up for the subsidy yet.
Though the campaign was officially launched by the Ministry of Petroleum & Natural Gas in January, it gained traction after Prime Minister Narendra Modi's appeal for the same at a national-level conference in March.
This is when the campaign took the format of the Give It Up "movement" rather than a simple "opt-out" option under the direct benefits transfer of LPG (DBTL) scheme.
This is also when business houses such as Tata Sons issued an appeal to their employees to give up their subsidy. While the company did not keep count of how many employees gave up the subsidy, it is confident that the appeal helped "multiply the numbers". "A lot of a people like me didn't know how to give the subsidy up. Both awareness and a sense of contribution to the national cause appealed to our employees," says a company spokesperson.
"Desh chalana hai toh desh ka har naagrik bhaagidaari karne ko tayyar hota hai. Aur main unko avsar dena chahta hun (If you want to run a country, then every citizen of a country wants to be a stakeholder. I was to give them an opportunity to participate)," Modi said during his speech at the conference in March.
His somewhat "emotional" appeal, according to an oil and natural gas ministry officer, helped instill a sense of patriotism through something as little as a subsidy of roughly Rs 200 per cylinder.
In its present form, the campaign is backed strongly by a sound technological process. The ease of giving up a subsidy is perhaps greater than, say, linking your Aadhaar card to your bank account and with DBTL to avail the subsidy.
Subsidies, but for whom
The government offers 12 subsidised cylinders to every household with an LPG connection in a year, which costs the exchequer Rs 40,000 crore annually. There were several attempts by previous governments to bring this number down to nine or even six per household, which, according to experts, would have saved the government Rs 8,000 crore (according to estimates based on fuel prices in 2013-14).
But all such suggestions met with huge protests from middle-income families, making governments nervous about their voter base and rolling back any cap on subsidised cylinders.
According to a 2012 paper titled Subsidies for Whom in The Economic and Political Weekly (EPW), 66 per cent households in urban and 59 per cent in metropolitan areas in India use LPG as cooking fuel. This number for rural areas stood at a mere 18 per cent. An addendum from the authors of the paper in 2013, based on data from the National Sample Survey in 2009-10, put the rural numbers at a mere 12 per cent.
This would explain the move towards adopting technology as the backbone of this campaign, making it more accessible and appealing to its urban consumer base, especially since it is significantly larger than the number of LPG consumers in rural areas. According to sources at the petroleum ministry, the next step after achieving the one million mark would be to leverage the campaign on the social media.
On the rural front, the campaign is expanding the LPG consumer base by allocating a subsidised connection to a rural household for every subsidy that is given up. This works in tandem with the Swachh Bharat campaign, where rural households get an opportunity to switch to cleaner, safer fuel.
In this case, according to the ministry official, the total number of households who were allocated an LPG connection could even be more than the total number of consumers who have given up their subsidy. But through a mapping process, the website automatically links the name of a consumer signing up for Give It Up with a rural household that earns an LPG connection.
Getting it right
The "champions and beneficiaries" list on the websites of Indane, Bharat Gas and H P Gas allow those who have given up their subsidy to feel a sense of purpose and give the appearance of a transparent process.
Sanjay Malhotra, a 52-year-old resident of South Delhi, had apprehensions about what would happen with the subsidy funds saved. "This is the general sense among urban households that tax given to the government goes waste. But seeing my name on that list gives me a sense of accountability," he says. Delhi is among the top three states in terms of the number of households that have given up subsidy.
While householders have protested against a cap on the number of subsidised LPG cylinders, a ministry official says that according to the government's research, a household uses an average of seven cylinders in a year. "At an average subsidy of Rs 200-250 per cylinder, this means an increase of mere Rs 1,500-1700 in a household's annual budget," says the official.
In cities like Delhi, though, many households have given up their subsidy after switching to piped natural gas (PNG). But according to the ministry official, this number is currently very low. Nearly 2.8 million households use PNG in their kitchens across India.
Another factor contributing to the success of the campaign could be some stealth measures, according to a report in Hindustan Times. For example, pressing "0" instead of "1" in the interactive voice response system (IVRS) could lead you to give up your subsidy rather than book a refill, though officials at Indane and the ministry deny this. "The IVR system is just another tool to ease the process, there are no stealth measures involved since the instructions are very clear," says an Indane executive.
Long road ahead
But experts fear that the campaign, though high on noise, will make minimal impact on the government's unmanageable subsidy burden. "Using absolute numbers like 1 million have an appeal for the foreign audience. When you look at it as a percentage, 1 million is less than 1 per cent of the total LPG connections," says Reetika Khera, associate professor at Indian Institute of Technology, Delhi.
Though, she adds, this is a step in the right direction. "In my opinion, the LPG subsidy is a much better candidate for 'targeted' subsidies (than, say, the food subsidy) since the majority of households that benefit from it currently are those who can afford it anyway."
Rahul Lahoti, author of the EPW article and a PhD student at University of Goettingen, Germany, believes that the campaign is only a stopgap measure. "When the government is taking several non-voluntary initiatives to limit the amount of food subsidies, it's puzzling why similar efforts are not being made with regard to LPG subsidies. Food subsidies, even with the substantial leakages, have shown to be pro-poor, while LPG subsidies clearly benefit the richer and urban households more," he says.
Lahoti adds that if the scheme of limiting subsidy to six cylinders per year was implemented, the government could have saved about one-fifth of the total LPG subsidy. The impact of this subsidy decline would have fallen mostly on the richer households as they tend to consume more. "Compare this with only Rs 140 crore saved through the Give It Up campaign [since Modi's appeal in March] - less than 2 per cent of the potential savings."
Slow and steady wins the race, goes the adage.
