Shri Ram Naik,
Minister of Petroleum & Natural Gas, has approved a proposal
to reduce the Security Deposit on a domestic LPG cylinder of
14.2 Kg. weight by Rs. 50/- w.e.f. 1.3.2003. This will bring
down the security deposit to Rs. 650/- per cylinder from the
present Rs. 700/- per cylinder.
It may be recalled
that the reductions in security deposit on domestic LPG cylinder
have resulted from the introduction of tender system in the
year 2000 for procuring LPG cylinders. The procurement price
of LPG cylinders during the earlier ‘cost plus’ system on an
average was about Rs. 850/- per cylinder and the security deposit
was Rs. 900/- per cylinder.
Following the introduction
of tender system to procure cylinders, the procurement price
came down to on an average about Rs. 650/- per cylinder in the
first year. Hence, the security deposit was reduced to Rs. 700/-
per cylinder with effect from 1.2.2002, thus passing on the
benefit of lower procurement price to the consumers. This resulted
in annual savings of about Rs. 200 crore to the customers all
over the country as about 62 lakh new LPG customers including
24 lakh double bottle connections (DBC) were enrolled during
the last one year. During the current procurement exercise,
procurement price of a cylinder further fell down to on an average
about Rs. 550/-. The benefit of the lower procurement price
is being passed on the customers by effecting reduction in security
deposit for the second time after introduction of tender system
for procurement of LPG cylinders.
