Dispelling the Myth of Cheaper LPG Prices During the UPA Tenure: Read the full Report

In the midst of India’s electoral fervor, a wave of misinformation has flooded social media platforms, with claims ranging from political rhetoric to economic policies. One such assertion gaining traction revolves around the purported cost of LPG cylinders, sparking comparisons between current prices and those prevalent during the previous administration.

Amidst the cacophony of political rallies and impassioned speeches, a viral claim suggests that LPG cylinders are being sold at exorbitant rates ranging between 1100 to 1200 rupees. This assertion is compared against the alleged affordability of LPG cylinders during the tenure of the previous UPA government, citing prices in the range of 400 to 450 rupees in 2014.

Islamist Amina posted on X, ‘LPG Price: 2014 : Rs. 410. 2024 : Rs. 1200. When you go to vote, do Namaskar to the gas cylinder at home as they are snatching that also: Narendra Modi.’

LPG Price :

2014 : Rs. 410
2024 : Rs. 1200. 🥵🥵

When you go to vote, do Namaskar to the gas cylinder at home as they are snatching that also: Narendra Modi#Vote4INDIA #VoteForINDIA

— أمينة Amina (@AminaaKausar) April 19, 2024

Shoaib Mohammad tweeted, ‘Where is she now? Gas Cylinder prices: Before 2014- ₹410. Nowadays- ₹1114.’

Where is she now?😁
Gas Cylinder prices:
Before 2014- ₹410
Nowadays- ₹1114 pic.twitter.com/YSwc2lp8b6

— Shoaib Mohammed (@shoaibpage) April 17, 2024

Congress worker Paul Koshy wrote, ‘Price of subsidised LPG Gas Cylinder for Domestic use in January 2014 -Rs. 414. January 2024       Rs.905.50. Price Rise is destroying the poor and middle-class families.’

Price of subsidised LPG Gas Cylinder for Domestic use in

January 2014 Rs. 414.00
January 2024 Rs.905.50

Price Rise is destroying the poor and middle class families. pic.twitter.com/Jqi6A6e3x9

— Paul Koshy (@Paul_Koshy) April 17, 2024

Vasan MSV wrote on X, ‘Another example of Modi Gobarment siphoning the common person’s blood to fill the pot bellies of their corporate cronies. 2014-15. Subsidised LPG Cylinder Price : Rs.410. LPG Subsidies; 40000 Crores .2023-24- Subsidised LPG Cylinder Price : Rs.1210LPG Subsidies; 12000 Crores.’

Another example of Modi Gobarment siphoning the common person’s blood to fill the pot bellies of their corporate cronies.

2014-15
Subsidised LPG Cylinder Price : Rs.410
LPG Subsidies; 40000 Crores

2023-24
Subsidised LPG Cylinder Price : Rs.1210
LPG Subsidies; 12000 Crores

If… https://t.co/3D7qZ09wcY pic.twitter.com/ehyCn2r1Xh

— Vasan MSV (@VasanMSV) April 12, 2024

Congress supporter Rohini Anand wrote on X, ‘Gas Cylinder prices:  Before 2014- ₹410. Nowadays- ₹1114. If Modi becomes PM again, the gas cylinder price may go beyond ₹1500 – ₹2000. One of the biggest reasons not to vote for BJP. Who all agree?’

Gas Cylinder prices:

Before 2014- ₹410
Nowadays- ₹1114

If Modi becomes PM again, the gas cylinder price may go beyond ₹1500 – ₹2000

One of the biggest reasons not to vote for BJP.

Who all agree? #LokasabhaElection2024 pic.twitter.com/MJ5YTmtVFT

— Rohini Anand (@mrs_roh08) April 16, 2024

Congress supporter Vijay Thottahil wrote on X, ‘People of India should decide what they want!! Vote wisely or you will suffer and regret!’

People of India should decide what they want!!
Vote wisely or you will suffer and regret! pic.twitter.com/wmeaTm0gMn

— Vijay Thottathil (@vijaythottathil) April 2, 2024

Aam leader Amanpreet Singh Uppal wrote on X while quoting the words of AAP spokesman Aadil Khan, ‘The slogan that Modi ji gave in 2014 and 2019, he is giving the same slogan in 2024. I had to pay 35 rupees for petrol, today it has crossed 100. I was supposed to pay Rs 350 for a gas cylinder but today it is over Rs 1200. BJP does not have a resolution letter, but a Jumla letter.‘

मोदी जी ने जो जुमला 2014 और 2019 में दिया, वही जुमला 2024 में दे रहे हैं

₹35 पेट्रोल देना था, आज 100 पार है
350 का गैस सिलिंडर देना था आज 1200 पार है

भाजपा का संकल्प पत्र नहीं होता बल्कि जुमला पत्र होता है @AdilKhanAAP pic.twitter.com/Knz0vHfvj5

— Amanpreet Singh Uppal (@iAmanUppal) April 15, 2024

Furthermore, Priyanka Maurya, Ranjeet Thakur from AAP, and other political figures have propagated claims suggesting a substantial increase in gas prices when compared to the UPA tenure.

Fact Check

Our investigation started by scouring the pertinent information available online, we got the idea that each state applies different taxes on LPG, so our initial step will be to assess how taxes are levied on LPG in each state and how this impacts its price. According to the  Clear Tax. in. domestic LPG cylinders are categorized under the 5% GST tax slab, comprising a combination of CGST (2.5%) and SGST (2.5%). Notably, there exists no separate tax levied on domestic LPG cylinders by state governments.

Delving deeper into the financial intricacies, we discovered additional costs contributing to the retail price of domestic LPG cylinders. As per the Petroleum Planning & Analysis Cell (PPAC), a distributor’s or dealer’s commission of Rs. 61.84 is factored in, encompassing both delivery charges (Rs. 27.60) and establishment charges (Rs. 34.24). It is imperative to note that at the state level, no supplementary taxes are applicable. However, the price dynamics of domestic LPG cylinders exhibit variability across regions, owing to factors such as the cost price per cylinder at LPG bottling plants and associated uncompensated costs like inland freight charges.

To further analyze LPG cylinder prices in India, we will focus on the state of Delhi as our benchmark. It’s important to note the dual distribution of LPG cylinders to households: subsidized cylinders for marginalized communities and non-subsidized cylinders for the middle-income bracket and above.

According to data from the Indian Oil Corporation website, in August 2023, the price of a non-subsidized cylinder stood at 903 rupees. Comparatively, in April 2014, at the end of the UPA regime, the cost of a non-subsidized cylinder was reported at 980 rupees.

However, as of 2024, the current price of LPG cylinders in Delhi is recorded at 803 rupees. To reiterate, a decade ago, during the UPA regime’s tenure, the cost of a domestic non-subsidized cylinder was 980 rupees. Fast forward ten years, with an average annual inflation rate of 5-6%, the contemporary price of an LPG cylinder has decreased to 803 rupees. This is a noteworthy reduction of 177 rupees, even after accounting for compound inflation over the past decade.

Continuing our analysis, let’s now turn our attention to the pricing of subsidized cylinders. According to a report by India Today dated January 2, 2014, the cost of subsidized cylinders in Delhi was approximately 414 rupees. Additionally, as reported by the Indian Express, in March 2024, the cost of subsidized cylinders under the Pradhan Mantri Ujjwala Yojana is 503 rupees in Delhi.

This indicates that after a decade of moderate inflation, the price of subsidized cylinders has increased by a mere 89 rupees. This minimal increment over the span of 10 years underscores the relatively stable pricing of subsidized cylinders despite economic fluctuations. Moreover, under PMUY the Modi government is providing deposit-free LPG connections to women from poor households.

After a detailed examination, it becomes evident that the opposition has engaged in a tactic of misleading the public for electoral gain. Their strategy involves comparing subsidized LPG rates from the UPA era with non-subsidized rates under the NDA government, all in a bid to sway public opinion and secure votes.

International LPG Pricing: Impact on the Indian Market During the UPA and NDA Tenure

Additionally, it’s worth noting that the price of LPG is heavily influenced by international market dynamics, given that a significant portion of India’s LPG is imported from Gulf nations. According to data from the International Energy Agency (IEA), countries such as the UAE, Qatar, Saudi Arabia, and Kuwait collectively supply over 95% of India’s LPG imports, with a minor contribution from the US in recent years. Notably, the UAE emerged as the primary supplier in 2023, accounting for nearly one-third of India’s total LPG imports. Importantly, supplies from the UAE have demonstrated consistent growth since 2017.

Transactions for LPG purchases from the UAE and Qatar primarily occur in the spot market, whereas Saudi cargoes are typically procured under long-term contracts.

According to data from Trading Economics, over the past decade, the international market price trend of LPG experienced significant spikes in March 2014 and October 2022, attributed to heightened geopolitical tensions and conflicts in the region.

Examining domestic prices during these periods reveals that in March 2014, the price of an LPG cylinder in Delhi reached 1080.5 rupees. Similarly, in July 2022, amidst comparable international price peaks, the domestic price of LPG stood at 1053 rupees, remaining unchanged until February 2023.

This indicates that both the UPA and NDA governments encountered elevated LPG costs during their respective tenures, with the NDA government notably maintaining relatively lower LPG prices for consumers, even amidst challenging geopolitical circumstances in Europe and West Asia.

In conclusion, there is a rampant spread of misinformation by Congress supporters in a bid to salvage their political standing. However, a comprehensive analysis reveals that the opposition’s comparison of subsidized LPG rates during the UPA era with non-subsidized rates under the NDA government is misleading. A closer examination of non-subsidized LPG rates in 2014 and 2024 demonstrates a significant decrease of 177 rupees, even after factoring in a decade of inflation.