New Delhi: The appeal of Congress vice president Rahul Gandhi to raise the cap on subsidized LPG cylinder may force Finance Minister P. Chidambaram to relax the expenditure ceiling his ministry had imposed on the Oil Ministry.
Ratan P. Watal, the Expenditure Secretary requestd it to “strictly adhere” to the Revised Expenditure ceilings for the current financial year in a letter to Additional Secretary & Financial Advisor S.C. Kuntia in the Oil Ministry on December 13.
“Under no circumstances should the ceiling be breached” — is written in bold and underlined in the letter.
The letter also states that the Department of Economic Affairs had issued instructions that expenditure during January-March 2014 must not exceed 33 per cent of the RE. The ceiling for the month of March has been set at 15 per cent.
Notify that if the government raises the annual cap from nine to 12, the higher subsidy outgo will force the Oil Ministry to breach the ceiling. The Ministry estimates the additional burden at nearly Rs. 7,000 crore.
Sources of Finance Ministry said they would take a call on relaxing the expenditure ceiling on receiving the Oil Ministry’s proposal.
Notify that Congress vice president had appealed to Prime Minister Manmohan Singh to hike the quota of subsidised LPG cylinders from nine to 12 at the AICC session which held on January 17.
Petroleum and Natural Gas Minister M. Veerappa Moily had announced that the Cabinet was likely to consider it just within hours of this request.
Bureau Report
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