Why Ujjwala scheme is losing battle against traditional fuels in rural India
On the face of it, Pradhan Mantri Ujjwala Yojana has accomplished a lot. More than 7 crore households have received subsidised cooking gas connections under the scheme. More than 82% of have bought refills in the last year. In Haryana, the best performing state, 97.5% of households have returned for a refill in a year.
The government claims that, on average, the rate of refill is high — 6.5 cylinders a year against 8 by households with non-subsidised LPG connections. But a ground-level assessment of the scheme shows several teething problems, from delays in delivery of cylinders and subsidies to continued preference for food cooked on firewood or cow dung cake.
The scheme was launched three years ago on May 1, 2016, in Uttar Pradesh’s Ballia district. Under Ujjwala, the government provides the gas cylinder, regulator, and the pipe for free. An executive at an LPG dealership in the district, who did not want to be named, said the beneficiaries of the scheme do not regularly refill their LPG cylinders because of the high price. “We have to force them to get a refill by warning them they will lose their connections if they don’t,” he said.
A survey in February by Research Institute for Compassionate Economics, an Indian non-profit research, found that over 90% of Ujjwala beneficiaries still use old means of cooking.
One reason for this is the stiff upfront payment for buying a refill. “Refilling a cylinder costs almost half the average monthly per capita expenditure in rural India, according to a National Sample Survey Office 2013 report, and if used exclusively, the average rural household would likely go through a cylinder each month. It’s possible that poor households do not refill their cylinders often because of the expense,” the report said.
Also, solid fuels don’t cost much and are readily available. Households with cattle make dung cakes, while those that own land use agricultural waste or tree branches for firewood. Public land and forests are also a source of free wood. States with lowest rate of refills are generally those with easier access to forests.
Guddi Devi of Ballia district, a beneficiary, said she uses the LPG cylinder sparingly. “For daily cooking, we use the chulha, but when guests are there, we use the LPG cylinder to make tea and snacks,” she said. Devi uses two or three cylinders a year. Official data shows that some parts of India are well below the national average of 82% refill rate.
“LPG is considered unsuitable for making traditional items such as litti and rice or madua ki roti in Bihar or bajra or makke ki roti in the northern states. Chulhas are considered to add taste and flavour to such food,” an HPCL executive who served as a district nodal officer in a northern state said. LPG marketing companies have held more than one lakh ‘LPG Panchayats’ across the country to dispel these notions.
“It’s difficult for these households to pay even the subsidised price, let alone buy cylinders at market price,” says Anil Srivastava, nodal officer in Ballia for state-owned gas majors IOC, HPC and BPC. LPG cylinders in Ballia cost Rs 782, and subsidised cylinders Rs 485.
Households also complain of time taken for the subsidy transfer. Many families, especially those below the poverty line, don’t have spare cash to wait for the subsidy to be transferred to their accounts beyond a few days.
The subsidy amount, pegged at Rs 210.64 per cylinder with 14.2kg of LPG, is supposed to be transferred within five days after a refill is delivered. But in practice, it takes longer as rural dealers take time to send confirmations to the respective oil companies before starting the long payment process.
An oil ministry official said introduction of 5kg cylinders addresses the problem of affordability. Ujjwala households can now swap their normal cylinder for the smaller ones so the upfront payment becomes affordable. The 5kg cylinder costs Rs 184.34 after a subsidy of Rs 74.76.
Ujjwala was launched with a target of giving free LPG connection to 5 crore BPL households by March 2019. The target was later raised to 8 crore by 2021 and now envisages giving all households a connection. The scheme has helped expand LPG coverage to 94% of households in the country in 2018 from 61% in 2016, and turned India into the world’s secondlargest domestic LPG consumer after China. The numbers are impressive but the next challenge is getting Ujjwala beneficiaries to make a complete shif ..