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Government Strengthens LPG Distribution and Subsidy Transfer Mechanisms

Written by: Sachin GuptaUpdated on: 6 Aug 2025, 3:08 pm IST
The Government highlighted the impact of flagship programs such as the PAHAL (DBTL) Scheme, Aadhaar-based verification, and others.
Government Strengthens LPG Distribution and Subsidy Transfer Mechanisms
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The Government of India remains committed to ensuring that domestic LPG distribution and subsidy transfers are efficient, transparent, and inclusive, said Shri Hardeep Singh Puri, Minister of Petroleum and Natural Gas.

Petroleum Minister stated that the impact of flagship programs such as the PAHAL (DBTL) Scheme, Aadhaar-based verification, biometric authentication, and deduplication of LPG connections has significantly bolstered the integrity of the subsidy transfer process. These measures have helped eliminate duplicate, ineligible, or inactive connections and ensured targeted benefit delivery.

To enhance consumer empowerment and transparency, a nationwide IVRS/SMS refill booking system has been rolled out across all LPG distributorships.

Additionally, Oil Marketing Companies (OMCs) have introduced a Delivery Authentication Code (DAC). This code, sent via SMS after the cash memo is generated, must be provided to delivery personnel to authenticate the transaction, minimising delivery fraud.

Major Reforms in Subsidy Delivery

PAHAL (DBTL) Scheme

Launched in January 2015, this initiative ensures that LPG cylinders are sold at market price, while applicable subsidies are directly credited to consumers’ bank accounts. Notifications confirming successful or failed transactions are sent via SMS.

The scheme has played a crucial role in detecting and blocking ghost accounts, duplicates, and inactive connections. As of July 1, 2025, over 4.08 crore such connections have been deactivated.

Common LPG Database Platform (CLDP)

To maintain a clean and unified database, the CLDP enables the identification and elimination of duplicate connections using Aadhaar, bank details, ration cards, and other identifiers.

Biometric Aadhaar Authentication

Biometric verification enhances accuracy in beneficiary identification. Public sector OMCs have been directed to complete biometric authentication for all PMUY and PAHAL beneficiaries. As of July 1, 2025, 67% of PMUY beneficiaries have completed this process, with new beneficiaries undergoing authentication before connection issuance.

Removal of Ineligible Consumers

Targeted efforts under PAHAL have led to the termination of 8.49 lakh ineligible PMUY connections. A Standard Operating Procedure (SOP) introduced in January 2025 also enabled the removal of inactive connections—around 12,000 connections have since been deactivated.

Enhancing Aadhaar Compliance

Transaction failures have been addressed through increased Aadhaar seeding and compliance. As of July 1, 2025, 92.44% of active LPG consumers have Aadhaar linked to their accounts, and 86.78% of DBTL beneficiaries are Aadhaar Transfer Compliant, ensuring timely subsidy credits.

Regulatory Framework and Enforcement

The distribution of LPG is governed by the Liquefied Petroleum Gas (Regulation of Supply and Distribution) Order, 2000, and OMCs have implemented Marketing Discipline Guidelines. These guidelines impose penalties on distributors found guilty of malpractice, ensuring strict adherence to service standards.

Also Read: Crude Oil Prices Recover Slightly from 5-Week Low Amid Geopolitical Tensions

Performance and Grievance Redressal

In the fiscal year 2024–25, around 194 crore LPG refills were delivered. Complaints were registered for only 0.08% of these deliveries, mostly related to subsidy issues or delivery delays, highlighting the system’s overall efficiency.

Shri Puri concluded by noting that the LPG grievance redressal mechanism has been progressively upgraded to improve the overall consumer experience, ensuring timely responses and quality service delivery.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.

Published on: Aug 6, 2025, 9:32 AM IST

Sachin Gupta

Sachin Gupta is a Content Writer with 6+ years of experience in the stock market, including global markets like the US, Canada, and Australia. At Angel One, Sachin specialises in creating financial content that simplifies complex market trends. Sachin holds a Master's in Commerce, specialising in Economics.

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