Lok Sabha Question No. 2517 (UNSTARRED), answered on 2016-08-01
Subject: Black Marketing of Kerosene
Ministry: PETROLEUM AND NATURAL GAS
Asked by: K.R.P. PRABAKARAN, SAKUNTALA LAGURI, GOPALAKRISHNAN CHINNARAJ, PRABHAS KUMAR SINGH, LAXMAN GILUWA, RAMACHANDRAN MULLAPPALLY, BALABHADRA MAJHI, RAM TAHAL CHOUDHARY

## LOK SABHA UNSTARRED QUESTION NO.2517 TO BE ANSWERED ON 1 st  AUGUST, 2016

## BLACK MARKETING OF KEROSENE

2517.  SHRI K.R.P. PRABAKARAN: SHRIMATI SAKUNTALA LAGURI: DR. C. GOPALAKRISHNAN: DR. PRABHAS KUMAR SINGH: SHRI LAXMAN GILUWA: SHRI MULLAPPALLY RAMACHANDRAN: SHRI BALABHADRA MAJHI: SHRI RAM TAHAL CHOUDHARY:

## पैट्रोलियम और प्राक ृ लिक गैस मंत्री

Will the Minister of PETROLEUM & NATURAL GAS be pleased to state:

- (a)     whether the instances of Oil Marketing Companies (OMCs) not following/complying with 'in house market system' in view of doping/adulteration of kerosene oil distributed under Public Distribution System (PDS) reported/noticed by the Government during the last three years;
- (b)    if  so,  the  details  thereof  and  the  action  taken  by  the  Government  thereon, State/OMC/UT-wise;
- (c)    whether the Government proposes to allow OMCs to increase the rate of kerosene in  phased  manner  and  reduce  the  subsidy  on  kerosene  in  the  backdrop  of  black marketing  and  if  so,  the  details  thereof  along  with  quantum  of  subsidy  given  by  the Government during the said period State/OMC/UT-wise;
- (d)      the  efforts  made  by  the  Government  to  provide  kerosene  to  hostels/Government schools for poor rural/tribal students and hospitals for patients to remove the difficulty of regular power cut there; and
- (e)    whether  the  Government  has  noticed  any  shortage  of  kerosene  in  the  country including Jharkhand if so, the details thereof and the steps taken to increase the allocation to various States, State/UT-wise?

## A N S W E R

पैट्रोलियम और प्राक ृ लिक गैस मंत्रािय में राज् य मंत्री ( स् विंत्र प्राार )  ( री ेमध श्र प्रेान )

## MINISTER OF STATE (INDEPENDENT CHARGE) IN THE MINISTRY OF PETROLEUM & NATURAL GAS (SHRI DHARMENDRA PRADHAN)

- (a) & (b) : At present, there is no such scheme in vogue for doping of in house marker in kerosene oil distributed under Public Distribution System (PDS) by Public Sector Oil Marketing Companies (OMCs).

(c) :  The Government has authorized the OMCs to increase the Retail Selling Prices of PDS Kerosene by 25 paise per litre per month (excluding  VAT as applicable in different States/Union Territories) for 10 months.

The total amount of under-recovery incurred on sale of PDS Kerosene for the last three financial year is given below :

Rs. in Crores

|               | 2013-14   | 2014-15   | 2015-16   |
|---------------|-----------|-----------|-----------|
| PDS Kerosene# | 31,255    | 24,804    | 11,496    |

# Includes Subsidy under 'PDS Kerosene and Domestic LPG Scheme, 2002' & 'Freight Subsidy (for Far-Flung Areas) Scheme, 2002' on payment basis.

With a view to reach the PDS kerosene to the targeted beneficiaries, it has been decided to implement Direct Benefit Transfer in Kerosene (DBTK) during 2016-17 in 39 districts identified in consultation with State Governments spread across nine  States  of the country, namely; Punjab, Gujarat, Himachal Pradesh, Madhya Pradesh, Chhatisgarh, Rajasthan,  Jharkhand,  Haryana  and  Maharashtra.  Other  States/UTs  have  also  been requested to join the Scheme.  It has also been decided that the States would be given cash incentive of 75% of subsidy savings during the first two years, 50% in the third year and 25% in the fourth  year.  In  case  the  States  voluntarily  agree  to  undertake  cuts  in kerosene allocation, beyond the savings due to DBT, a similar incentive would be given to  those  States/UTs.  Preparation  to  implement  DBTK  by  the  participating  States  is reviewed regularly.

(d) :  The Government  of India allocates PDS Kerosene to States/UTs on quarterly basis for distribution under PDS for cooking and illumination only.  Further distribution within the  States/UTs  through  their  PDS  network  to  various  categories  of  consumers  as  per their respective criteria, is the responsibility of the concerned States/UTs.  In addition, the Government has allowed the States/UTs to draw one month quota of Kerosene at nonsubsidized  rates  during  each  financial  year  w.e.f.  2012-13  for  special  needs  such  as natural calamities, religious functions, fisheries, various 'yatras', 'melas' etc.   States/UTs can also seek further additional allocation of non-subsidized SKO from this Ministry after exhausting this one month's quota.

In addition to above, with a view to ease the availability of white Kerosene (Market Priced Kerosene) for sale in the open market, the Central Government has amended the Kerosene (Restriction on Use and Fixation of Ceiling Price) Order, 1993.  It is expected that this will reduce demand for diverted PDS Kerosene by improving availability of nonPDS  Kerosene  in  the  open  market  and  will  thus  meet  the  demand  of  Kerosene  for various legitimate end uses for the industry and for individual consumption by those who can afford it at market price.

(e) :  OMCs have informed that there is no reported shortage of PDS Kerosene in the country, including Jharkhand.

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