Fossil-Fuel Subsidy Reform in India: Cash transfers for PDS kerosene and domestic
LPG
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Under-recoveries on sale of petroleum products in
2011-12
INR 1,385.41 billion (USD 27.06 billion)
Total government subsidy bill on PDS kerosene and
domestic LPG in 2011-12
INR 30 billion (USD 0.59 billion)
Potential losses due to 40% diversion of PDS kerosene
at 2005-06 prices
INR 50 billion (USD 1.13 billion)
Excise duty on diesel potentially being lost at 2005-06
prices due to diversion
INR 10.21 billion (USD 0.23 billion)
Source: PPAC (2012a) and author’s calculations.
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Figure 1: Design elements and challenges for implementing cash transfers
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