DBT scheme for kerosene will be rolled out by Government from April 1, 2016 [ Current Affairs ]

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From 1st April 2016, the Union Government is going to roll out LPG-like Direct Benefit Transfer (DBT) scheme for kerosene. At the initial phase scheme will be implemented in selected 26 districts of eight states which are Haryana, Chhattisgarh, Jharkhand, Himachal Pradesh, Maharashtra, Madhya Pradesh, Punjab and Rajasthan.

Under the Scheme:

  • According to these scheme People will buy kerosene at market rate but they will get subsidy directly in their bank accounts.
  • The case amount which will pay to user is equivalent to the difference between current Public Distribution System (PDS) price and market rate of kerosene.
  • Kerosene subsidy will be credited to eligible recipients in advance to avoid any problem of payment of un-subsidized price during the initial phase.

Comment:

  • With this move Government will reduce subsidy outgo for kerosene which in 2014 - 15 was about 24, 799 crore rupees.
  • It will also help in plugging the trickles in the kerosene subsidy system.

About Direct Benefit Transfer (DBT):

  • DBT’s main aim is to change the mechanism of transferring subsidies launched by Government of India on 1 January 2013.
  • This program aims to transfer subsidies directly to the people through their bank accounts.

- Published on: January 8, 2016