The decision means, the state-owned fuel monopolist, which is suffering accumulated loss of Rs 24 billion and loan liabilities worth Rs 28 billion, will have to provide dealers and transporters an additional Rs 25 million per month (Rs 19.28 per cylinder).[break]
The cash-strapped NOC has been suffering a loss of Rs 439 in the sale of each cylinder.
“We will not pass on the additional cost to consumers until we enforce dual-color cylinders in the market,” Shiva Prasad Pudasaini, spokesperson for NOC, told Republica.
Pudasaini said the commission was increased keeping in view profit margin, transport charge and overhead cost of dealers and transporters.
LPG bottlers, who had opposed the government move of circulating dual-color LPG cylinders in the market, withdrew their weeklong agitation recently after the government agreed to increase commission on LPG cylinders.
The government has introduced dual-color cylinders -- blue for industrial and diplomatic sectors and red for general consumers -- from June 15 to regulate the government subsidy on cooking fuel. It plans to enforce dual pricing on LPG by July 15. Currently, red cylinder is available at subsidized price of Rs 1,470.
Around four dozen companies involved in LPG bottling business have a total of 3.9 million cylinders. Of them, around 1.3 million are regularly circulated in the market.
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