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21 Apr 2019·
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Modi’s Pet Scheme Pradhan Mantri Ujjwala Yojana Needs Reality Check

Modi’s Pet Scheme Pradhan Mantri Ujjwala Yojana Needs Reality Check

Like Mudra, Digital India and the Saansad Adarsh Gram Yojana (SAGY), another much-hyped pet scheme of Prime Minister Narendra Modi ‘Pradhan Mantri Ujjawal Yojana’ (PMUY) is a major success on paper or otherwise rhetorically by the BJP leaders, particularly Union Petroleum and Natural Gas Minister Dharmendra Pradhan, but a big failure practically.

The scheme was launched on 1 May 2016 with an objective to persuade the poor households to avoid using firewood and traditional biomass fuels that have the potential to cause respiratory diseases. Under the scheme, the Modi government targets to provide 5 crore free LPG connections to the families living in below-poverty line (BPL) over three years with financial assistance of Rs 1600. The upfront payment required for an LPG connection is also relaxed so as to make the scheme more attractive.

 More than two years since the roll out of the scheme, it’s now time for a reality check – whether the Modi’s signature initiative has achieved its primary objective of freeing poor households from more polluting and harmful methods of energy use.

Structural Flaw: One of major reasons for the failure of the PMUY is its structural flaw. As per the government notification, the first cylinder is given free to a BPL family, but the subsequent cylinders have to be paid by the beneficiary of the scheme. The price of a cylinder is almost market rates, making it burdensome for a poor family (whose income is less than Rs 32 a day in rural areas and Rs 47 a day in urban areas as per the Rangarajan committee) to afford. Hence, the scheme does not encourage the poor to use LPG as primary fuel for domestic uses.

Less Number of Beneficiaries Go for Refill: Modi claims that LPG connections have reached almost 100 per cent in 70 per cent village and over 75 per cent in 81 per cent villages. And his government is upbeat about achieving the target of providing 50 million free gas connections by 2019. It sounds good. But the ground reality tells a different story.

No doubt, the number of LPG connections across the country has tremendously increased by 16.26 per cent since the implementation of PMUY, but the growth is not proportionate to the use of gas cylinders. According to official data, the use of gas cylinders increased by just 9.83 per cent, even lower than the rate recorded in 2014-15, when the scheme was not launched. It is because of the simple reason that many people with new connections are not buying refilled cylinders after their first one runs out.

More Disturbing Figures: A Comptroller and Auditor General’s report stated that in 2015-16, households with LPG connections were using an average of 6.27 cylinders in a year. But after the scheme was launched, the number of cylinders used on average had come down to 5.6.

According to the data compiled by the Ministry of Petroleum and Natural Gas, a total of 4.70 crore had been provided with LPG connections up to July this year but only 2.70 crore, or 58% of the beneficiaries, did second refill of their cylinders. The number reduced further when it came to the third refill: only 2.07 crore or 44% went for the refill.

PMUY: A Scheme Launched Hastily Ignoring Research Report:  With Uttar Pradesh assembly elections round the corner, the BJP-led Central Government hurriedly launched the scheme without reviewing the results of a research study it commissioned from the rating agency CRISIL in 2015 to find out why users were not abandoning biomass fuels for cleaner LPG cylinders.

The rating agency conducted survey of more than one lakh people without LPG connections across 120 districts in 13 states between October and December 2015. Nearly 86% respondents said that they had not replaced biomass to LPG because the price of installing a connection was too high. 83% people felt the price of refills was too high. Other reasons attributed for not shifting from biomass to LPG included long wait time for second refill, availability of free cooking fuels like firewood or cow-dung cakes etc., The report stressed the need to reduce costs of refills.

CRISIL submitted the report in June 2016. But the Modi government launched the scheme in May, a month before it got the CRISIL report. Had the Union Cabinet considered the findings of the report while framing the details of scheme, the results would have been different.

Odisha: A Good Example of Failure of Ujjwala Scheme:  Odisha, which happens to be the home state of Union Petroleum and Natural Gas Minister Dharmendra Pradhan, has experienced total failure of Modi’s this pet scheme, despite tall claims made by his cabinet minister.

As per the Union Minister, more than 30.48 lakh beneficiaries have been covered under the scheme in Odisha in the last two years. However, only 8,18,000 refilled their cylinders in the financial year 2016-17 which dropped down to 6,45,000 in the financial year 2017-18.

It is quite disheartening to note the fact that in the home district of Pradhan, Angul, as many as 1, 05,508 gas connections have been provided in the last two years. In the financial year 2016-17 only 35,406 have refilled the cylinders and it has dropped down to 16,950 in the financial year 2017-18.

The beneficiaries were asked to take refill of LPG cylinder on market price which is very high while there was inordinate delay in releasing subsidy to the account of beneficiaries.

According to media reports, there are large-scale irregularities in selecting the beneficiaries of the scheme. It is also alleged that free gas connections have been given to ghost beneficiaries and people who already have LPG connection.

Apart from it, constant rise in gas price is another reason for the failure of this scheme in Odisha.

Last Word

In India more than 100,000 people die prematurely from diseases caused by inhaling smoke from firewood and other biomass used as fuel in traditional stoves. The jumla party’s jumla Yojana has a jumla effect. It is high time the Union Petroleum and Natural Gas Minister should check the reality and bring a white paper on the implementation of this scheme in parliament to dispel the jumla effect.