What is LPG and its Usage?
LPG, or Liquefied Petroleum Gas, is a type of fuel composed of propane and butane gases. It is used for cooking, heating, lighting, and even powering vehicles. It is often stored in pressurized containers, known as cylinders, tanks, or bottles, due to its very low boiling point. For households, the standard LPG cylinder size is 12.5 kg, and the price of LPG cylinders today has gone up significantly.
Reasons Behind the Price Hike
The price hike in LPG cylinders today is due to a combination of factors. The primary reason is the increase in demand for LPG cylinders from consumers. This is due to the rising cost of electricity, as well as the increased awareness of the health benefits of cooking with LPG instead of other sources of fuel such as wood or coal.
The cost of LPG cylinders has also been affected by the rising cost of crude oil. The cost of crude oil is directly related to the cost of LPG cylinders, as the majority of the price of a cylinder is made up of transportation costs.
In addition to this, the cost of LPG cylinders is affected by taxes and duties imposed by the government. This includes taxes such as the Goods and Services Tax (GST), as well as levies such as the Krishi Kalyan Cess (KKC).
Impact of the Price Hike
The price hike in LPG cylinders today will have a significant impact on households. For those who rely on LPG cylinders for cooking and other household needs, the increase in price could be a significant burden.
The increase in price could also lead to a drop in consumption, as households may opt to switch to other sources of fuel such as wood or coal. This could have a negative impact on the environment, as burning wood or coal emits a large amount of harmful pollutants into the atmosphere.
In addition, the price increase could lead to a drop in demand, which would have an adverse effect on businesses that are involved in the LPG cylinders supply chain, such as distributors and retailers.
The Government’s Response
In response to the price hike, the government has taken steps to ensure that households are not adversely affected by the increase. This includes reducing the GST rate on LPG cylinders from 12% to 5%, as well as the introduction of a subsidy on the price of the cylinder.
The government has also taken steps to ensure that the price of LPG cylinders is kept stable, by ensuring that the supply of cylinders is adequate and stable. This includes increasing the number of LPG cylinders that are imported, as well as increasing the number of domestic suppliers.
The price of LPG cylinders today has gone up significantly due to a combination of factors, such as the increase in demand, the rising cost of crude oil, and taxes and levies imposed by the government. This increase in price could have a significant impact on households, as well as businesses in the LPG cylinders supply chain. In order to ensure that households are not adversely affected by the increase in price, the government has taken steps to reduce the GST rate on LPG cylinders and introduce a subsidy on the price of the cylinder.