The Petroleum Ministry's Secretary, Neeraj Mittal, on Friday wrote to all Chief Secretaries of States and Union Territories, noting that several states have already implemented some or all of the reforms related to the allocation of non-domestic LPG across various sectors, news agency ANI reported.
On 16 March, states were initially allotted 40% of pre-crisis quota, with an additional 10% allocation linked to the implementation of certain reforms aimed at promoting the use of Piped Natural Gas (PNG).
The secretary informed that, in addition to the existing 50% allocation made earlier, an additional 20% is now proposed, bringing the total commercial LPG allocation to 70% of the pre-crisis level for packed non-domestic LPG.
The development comes amid heightened geopolitical tensions between the United States and Iran. As a result, Tehran imposed a blockade on the Strait of Hormuz, a critical maritime chokepoint through which a fifth of the world's crude oil and gas shipments pass.
This effective closure of the Strait has triggered volatility in global energy markets and raised concerns over disruptions in fuel supplies. India sources around 12–15% of its crude oil imports through the Strait of Hormuz, according to the news agency.
What industries will be prioritised? According to Mittal, the additional 20% allocation of commercial LPG shall be given to labour-intensive sectors that play a key role in supporting broader industrial supply chains.
Industries such as steel, automobiles, textiles, dyes, chemicals, and plastics will be given priority under the revised allocation framework. Within these sectors, preference shall be given to process-based industries or those requiring LPG for specialised heating purposes that cannot be substituted by Natural Gas.
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The secretary also urged all states to avail themselves of the 10% reform-based allocation immediately, if they have not already done so.
The secretary said that with this, the allocation to commercial or industrial LPG will rise to 70% (with 10% reform-based), providing massive relief to industrial operations in the state, ANI reported.
Govt steps in to protect consumers from spike in fuel prices Meanwhile, in another move to protect consumers from a spike in petrol and diesel prices due to the Middle East crisis, the government on Friday slashed excise duties for petrol and diesel.
According to a gazette notification dated Thursday, the additional excise duty on petrol was reduced to ₹3 per litre from ₹13 earlier. Meanwhile, the excise duty on diesel was cut to ₹0 from ₹10 per litre earlier. A windfall tax on the export of diesel has been set at 21.5 rupees/litre.
The move to cut petrol and diesel excise duty is aimed at providing relief to oil marketing companies amid the war in the Middle East, as oil prices continue to trade above $100 per barrel.