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The Pradhan Mantri Ujjwala Yojana (PMUY) is an initiative by the Indian government, aimed at providing LPG gas cylinders to rural and deprived households, targeting better health and environment by eliminating harmful traditional cooking fuels. However, the program has faced obstacles in ensuring sustained usage among the beneficiaries. It reflects that out of 9.58 crore PMUY households, 1.18 crore did not arrange for refills during 2022-23, and another 1.51 crore got one refill only. This limited consumption has raised concerns about the scheme’s ability to achieve its objectives.
Concerns Regarding the PMUY
The PMUY has faced several challenges, including limited refill consumption due to rising LPG cylinder prices and increased subsidy expenditure. The average beneficiary refilled fewer than four LPG cylinders during 2022-23, revealing a stark contrast to non-PMUY households that refilled around 6.67 per household. Also, the price of subsidized LPG cylinders soared by 82% between January 2018 and March 2023, making it less affordable for rural households.
About Pradhan Mantri Ujjwala Yojana (PMUY)
Introduced by the Ministry of Petroleum and Natural Gas (MOPNG), PMUY aims to make clean cooking fuel such as LPG available for rural and deprived households. The scheme provides financial support of Rs 1600 for each LPG connection to BPL households and offers other benefits like a deposit-free LPG connection, first refill and hotplate cost-free for the beneficiaries.
Objectives of PMUY
With the main objective of empowering women and protecting their health, PMUY also aims to reduce deaths due to unclean cooking fuels and prevent acute respiratory illnesses in children caused by indoor air pollution. PMUY first launched on May 1, 2016, with the target of releasing 8 Crore LPG Connections by March 2020. The scheme reached 99.8% LPG coverage on April 1st, 2021.
Ujjwala 2.0
Ujjwala 2.0 was proposed in the Union budget for FY 21-22, with a target of additional 1 crore LPG connections to eligible households by March 2022. This target was achieved in January 2022, and following this, another 60 lakh LPG connections were released under Ujjwala 2.0, further expanding the reach.
Formula To Calculate the LPG Price
The pricing of LPG is based on the Import Parity Price (IPP) formula, which takes into account various factors such as the international market rate, free on board (FOB) price, ocean freight, customs duties, port charges, insurance costs, and others. The price fluctuation of crude oil also affects LPG’s international price. Three major PSU suppliers, Indian Oil, BPCL, and HPCL, determine the retail selling price for non-subsidised cooking gas cylinders.
Way Forward
For the PMUY to achieve its objectives effectively, the government needs to intensify efforts to educate beneficiaries about the health and environmental benefits of using LPG. Regular assessments and evaluation of the subsidy amounts are necessary to keep LPG affordable for beneficiaries. Also, periodic evaluations of PMUY’s effectiveness can help in modifying policies to address emerging challenges.
