Thursday, 20 September 2012

News Hour- Congress-ruled states to increase cap on LPG cylinders to 9: Janardhan Dwivedi

NEW DELHI: In a move seen to pacify Trinamool Congress chief Mamata Banerjee, Congress-ruled states will increase supply of subsidised cylinders from 6 to 9 per household annually. AICC General Secretary Janardhan Dwivedi conveyed the intent to reporters after the Congress core committee meet ended on Wednesday. 

According to television channels, the additional cost of the subsidised cylinders will be borne by the state governments. 

Earlier it was reported that the government is also considering a partial rollback of a hike in diesel prices announced last week as part of a slew of " big bang" economic reforms that have plunged Prime Minister Manmohan Singh's coalition into crisis. 

A senior source in the ruling Congress party said the rollback was being considered. Finance Minister P. Chidambaram, however, declined to comment when approached by reporters. 

A hike in diesel prices and other reforms such as retail liberalisation prompted the government's biggest ally to withdraw from the coalition on Tuesday evening. 

Government raised the price of heavily subsidised diesel by Rs 5 to rein in its fiscal deficit and counter the threat of becoming the first of the big emerging economies to be downgraded to junk. 

Diesel is one of the main contributors to a subsidy bill that economists warn could push the country's fiscal deficit above a target of 5.1 percent of gross domestic product. 

But the fuel price increase caused an instant political backlash. 

Trinamool Congress on Tuesday dealt a severe blow to the UPA by deciding to withdraw its ministers from the Union government and its support but left open the doors for a possible rapprochement in the next three days. 

The second biggest constituent of the UPA with 19 members in Lok Sabha sprang a surprise after a meeting of its MPs and top leaders with a caveat that the party could reconsider its stand if the government rolls back its decisions. 

She wanted total withdrawal of the decision on FDI, raising the cap on subsidised LPG from six to 12 cylinders and reduction of diesel hike from Rs 5 by Rs 3 or Rs 4 for reconsideration of her decision.

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