No decision on subsidies

A day after Prime Minister Manmohan Singh highlighted the issue of subsidies on domestic LPG and kerosene, Petroleum and Natural Gas Minister Murli Deora held a meeting on the matter.

"We held a meeting today to take stock of the issue and discussed ways and means to address the same", Deora told Business Standard. He, however, did not give any details.

Sources said a final decision was likely to be taken once the monoson session of Parliament ended on August 25.

"This (subsidies for cooking gas and kerosene) is both a political and emotive issue. We have had no discussion on this," a senior minister had said earlier in the day.

The Prime Minister had highlighted the problem of the increase in oil prices and suggested, in his Independence Day speech, that the subsidies for LPG and kerosene needed to be revisited in this context.

The government pays a subsidy of Rs 22 per LPG cylinder and 83 paise on every litre of kerosene sold. "The government has a present subsidy burden of around Rs 24,000 crore on petrol, diesel, LPG and kerosene," a petroleum ministry official said.

However, the subsidy burden has reduced due to the increase in petrol and diesel prices, change in the pricing formula, issuing of oil bonds, reduction in Customs duty and sharing of losses by stand-alone refineries.