Domestic LPG cylinders are going to be costlier by Rs 25 from 15 May 2013. After the hike, each cylinder sells at Rs 437.50. The current price is Rs 412.50.
Union government hiked the cylinder price by Rs 50 way back in 2008. The state government bore the cost of subsidy close to Rs 550 crore. In January 2009, the price was reduced by Rs 25, the state government, did not pass it to the consumers and consequently the subsidy came down to Rs 225 crore per year.
Currently, a non-subsidised cylinder is priced at Rs 900. The oil marketing companies (OMCs) will credit the subsidy amount of Rs 463 directly into the Aadhaar-linked consumers, which means they will have to purchase the cylinder at Rs 437.50.
The price has been hiked because, the OMCs cannot include the Rs 25 subsidy given by AP state government for consumers, as OMCs credit equal subsidy to all consumers nationally.