PAHAL has succeeded in eliminating ghost beneficiaries of LPG subsidies and helping government to save Rs 12,700 crore, says Arshad KhanChief Economic Advisor Arvind Subramanian said on Thursday (2 July) that since the introduction of the new direct benefit transfer (DBT) scheme for LPG (PAHAL), sale of subsidised domestic LPG across the nation has fallen by close to 25 per cent. He said, “on an average, the direct benefit transfer (DBT) for LPG has lowered the sale of subsidised domestic sales by around 25 per cent, mainly due to fall in international fuel price and institutional improvement in schemes like Jan Dhan Yojna, Adhaar Card etc.” Talking about the fiscal impact of PAHAL, he said the scheme have been successful in eliminating ghost beneficiaries and helped government to save Rs 12,700 crore. “A major finding of our study reported that DBT led only 6 per cent increase in commercial sales but there was a monolithic increase of 132 per cent in the sale of non- subsidised commercial gas reason mainly because of black market", said the economist on July 2 while speaking at the UNDP Conference hall in Delhi. He said the study findings will be useful for the government to improve the current PDS under the present government’s ambitious JAM (Jan Dhan+Adhaar+ Mobile) vision. Citing JAM vision as game changer he said, “JAM will not only strengthen the state, it will increase economic effectiveness to empower people. Only the government should be cautious while implement the findings of the DBT study on other commodities.” About the challenges to realise the JAM vision, he classifies the challenges into two categories, first being investment in IT infra to identify the target beneficiaries and the second being to implement schemes on Jan Dhan Yojna platform. The PAHAL scheme covers more than 9.75 crore LPG consumers is one of the world’s largest cash transfer programme. Under the scheme, LPG cylinders are sold at existing market prices and the consumers receive the subsidy directly into their bank accounts either through an Adhaar or bank account linkage.
Read MoreOil futures hovered below three-week lows on Tuesday (30 June) after Greeks took to the streets to protest against austerity following a bank shutdown, keeping investors away from riskier assets and putting Brent crude on course for a second month of declines.Brent crude futures were down 16 cents at $61.85 a barrel at 0200 GMT, after falling to $62.01 on Monday, their weakest finish since 5 June. The contract is heading for its second straight monthly decline.US crude dropped 20 cents to $58.13, having closed down $1.30 at $58.33 a barrel, its lowest settlement since June 8. It is set for its first monthly decline in three."Greece is still the word," said Ben Le Brun, market analyst at OptionsXpress in Sydney. "That story doesn't look like stopping anytime soon."Tens of thousands of Greeks hit the streets on Monday after waking up to shuttered banks, closed cash machines and a climate of rumours and conspiracy theories following the breakdown in talks between Athens and its creditors.Any resolution to the crisis is unlikely before a referendum on Greece's bailout is held on Sunday, after Prime Minister Alexis Tsipras announced the vote, wrong-footing European leaders and policy makers.Investors are also looking at the US government's June payrolls report on Thursday and talks on Iran's disputed nuclear programme going on in Vienna, Le Brun said.The former may reinforce ideas that the US Federal Reserve might raise interest rates as early as September, the first such hike in about 10 years.The Vienna talks would continue past Tuesday's deadline for a comprehensive agreement intended to open the door to ending sanctions in exchange for limits on Iran's most sensitive nuclear activities for at least a decade, a senior U.S. official said on Tuesday.(Reuters)
Read MoreReliance Industries plans to shut a crude distillation unit (CDU) for a 10-day planned maintenance in the first half of July, it said in a statement on Monday (29 June), halving crude processing at its 580,000 barrels per day (bpd) refinery during the shutdown duration. The export-focussed refinery at the Jamnagar complex in western Gujarat state has two crude distillation units of equal size. "The planned maintenance turnaround at the refinery is not expected to have any impact on commercial commitments," it said. Reliance, owner of the world's biggest refining complex, has two mega-sized refineries in India. The older 660,000-bpd refinery at the complex also has two crude units and mainly caters to domestic demand. Other units at the Jamnagar refinery complex are planned to operate at normal throughput, it said.(Reuters)
Read MoreSaudi Arabia lost its spot last month as India's top oil supplier to Nigeria for the first time in at least four years, according to ship tracking data compiled by Reuters, as the world's top crude exporter struggles to maintain market share in Asia. The OPEC kingpin also fell behind Russia and Angola as the biggest crude supplier to China last month, official data showed this week. The Middle East country's failure to maintain its position in some markets comes despite it leading a strategy by the Organization of the Petroleum Exporting Countries (OPEC) to keep output high to drive out competitors. In India, refiners have been switching out of long-term contracts with Middle East suppliers in favour of spot purchases, often African oil. A glut of African cargoes has emerged as the U.S. shale boom cuts American demand and accelerated as OPEC keeps output high. The share of African oil, mainly from Nigeria and Angola, jumped to 26 percent of India's total imports in May, up from around 15.5 percent in April and the highest in more than four years, according to tracking data on tanker arrivals. At the same time, the Middle East share fell to 54 percent in May from 61 percent, with Saudi Arabia supplying some 732,400 barrels per day (bpd) compared with Nigeria's 745,200 bpd. The shift comes as the gap between the international benchmark Brent and the Middle East price marker narrows. The premium for Nigerian crude over Brent has plummeted in recent months, making it more attractive. "This gives advantage to the complex refiners like Reliance to buy superior grades of oil like those from Nigeria at discounted rates," said Ehsan Ul Haq, senior consultant at UK-based consultant KBC Energy Economics. Reliance Industries got about a quarter of its oil in May from Africa, the highest in at least three years. Indian Oil Corp aims to get 70 percent of its oil needs through term volumes compared to 80 percent last year, including a deal with Kuwait halved to 100,000 bpd. Another refiner, Bharat Petroleum Corp, plans to cut its dependence on term contracts to 75 percent this fiscal year from 82 percent a year ago, according to a source. Head of refinery operations at Hindustan Petroleum Corp, B. K. Namdeo, said purchases of West African oil make sense when Brent's premium over the Middle East price marker, known as Dubai swaps, is less than $2 per barrel. The spread has mostly hovered below that since oil prices crashed in the second half of last year and hit its lowest in two months this week at $1.32. KBC Energy's Haq estimates West African oil's share to India could average as much as 25 percent this year. (Reuters)
Read MoreCarlyle Group has committed to invest up to $500 million in Magna Energy Ltd, an India-focused upstream oil and gas company, the global private equity firm said in a statement on Monday. Led by Mike Watts and Jann Brown who have a combined 60 years of oil industry experience, Magna Energy is seeking to become a full-cycle oil and gas company through acquisitions and securing local licences in the Indian sub-continent. It will have a primary focus on development and production. The buyout shop is making the investment through its unit Carlyle International Energy Partners, a fund that focuses on oil and gas exploration and production. (Reuters)
Read MoreCairn India Ltd, India's largest private-sector oil producer, said on Monday it had moved the Delhi High Court against a $3.3 billion tax demand from Indian authorities related to its listing in 2007. The company, a unit of London-listed Vedanta Resources Plc, said it had filed a writ petition seeking "quashing/setting aside" of the order passed by the tax authorities. Cairn sought directions to the tax authorities not to take any coercive steps against it for recovery of the demand. Cairn India received last month the demand of about 204 billion rupees from Indian tax authorities for an alleged failure to deduct withholding tax on capital gains made by its former parent, Cairn Energy Plc, during a reorganisation ahead of its market listing. Vedanta said last month it would file a notice of claim against the Indian government under the UK-India bilateral investment treaty. Cairn Energy, which received a tax demand of more than $1.6 billion related to the same case, has also filed a notice of dispute under the bilateral investment treaty. Cairn India shares had gained 0.3 per cent in morning trade on Tuesday in a broader market that was up about 0.2 per cent. The tax notice came after Cairn Energy, the Indian company's former promoter, was slapped with a Rs 10,247 crore tax demand for an alleged Rs 24,500 crore worth of capital gains it made in 2006 while transferring all its India assets to a new company, Cairn India, and getting it listed on the stock exchanges. In a recent regulatory filing, Cairn India had said the demand comprised of Rs 10,248 crore in tax and the remainder Rs 10,247 crore in interest payout. Cairn India had also said that the demand notice was sent to it "for an alleged failure to deduct withholding tax on alleged capital gains arising during 2006-07 in the hands of Cairn UK Holdings Limited (CUHL)", its parent company which is a subsidiary of Cairn Energy Plc. This, it said, was in respect of the transaction of CUHL transferring the shares of Cairn India Holdings Ltd (CIHL) to Cairn India Limited as part of internal group reorganisation in 2006-07 to facilitate the initial public offer (IPO) of Cairn India Ltd. Cairn India said it "cannot be penalised by expecting that it ought to have withheld tax". "There was no taxable gains and accordingly, no liability to withhold tax on date of payment. Further, there cannot be any liability to withhold tax on consideration discharged by way of share swap," it said. (Agencies)
Read MoreAfter two consecutive hikes, petrol prices were Wednesday (1 April) cut by 49 paise per litre and diesel by Rs 1.21 a litre on softening international oil rates. The reduction in rates will be effective from midnight tonight. Prices of petrol in Delhi will be Rs 60 a litre from tomorrow as against the current Rs 60.49, while diesel will cost Rs 48.50 per litre as compared with Rs 49.71 currently, Indian Oil Corp (IOC), the nation's largest oil company, said. The reduction follows two rounds of price hikes in February and March -- first by Rs 0.82 a litre in petrol and Rs 0.61 per litre in diesel on February 16 and by Rs 3.18 per litre in petrol and Rs 3.09 a litre in diesel on March 1. Since the last price change, "the international prices of both petrol and diesel have declined. The Rupee-US Dollar exchange rate has, however, depreciated. The impact of both these factors warrants decrease in retail selling prices of both petrol and diesel," IOC said in a statement. Prior to these increases, petrol price had been cut on ten occasions since August 2014 and diesel six times since October 2014. Cumulatively, petrol prices had been cut by Rs 17.11 per litre in ten reductions since August and diesel by Rs 12.96 a litre since its deregulation in October. This trend was reversed when rates were raised on February 16.
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