The government will fork out oil subsidy worth Rs 8,500 crore to state-owned firms in the fourth quarter of 2018-19 for selling cooking gas and kerosene below cost.
While Rs 7,640 crore has been allocated for LPG cylinder, an amount of Rs 860 crore will be given for the under-recovery on the sale of subsidised kerosene oil, officials said.
Unlike kerosene, which is sold at a subsidised price, cooking gas is sold at market price and the subsidy amount is credited to consumers’ bank accounts by the oil marketing companies. In kerosene, the government compensates the companies for the subsidy payouts made to the consumers
