23 August 2017

The Indian government has made efforts to switch rural cooking fuels from the traditional biomass and fuelwood to cleaner fuels such as Kerosene and LPG. While traditional cooking fuels such as biomass and fuelwood have been historically cheap and easily accessible, there has been a steady decline in the availability of fuelwood and a steady increase in its price in the market. In addition, both biomass and fuelwood used in indoor cooking are great health hazards and affect women and children more than men (as they are less likely to be present during the cooking process). The WHO estimates that there are approximately 5 lakh deaths in India alone due to unclean cooking fuels. These include deaths caused because of diseases such as lung cancer, chronic obstructive pulmonary disease and other heart and lung related diseases (WHO, 2007).

While the use of LPG for cooking removes the health hazard, it is also relatively expensive, with additional upfront costs to get the initial LPG cylinder and buy a stove. Additional barriers to the use of cleaner cooking fuels such as LPG include reluctance to change traditional cooking practices and distrust of new technology and its safety.

The government has tried to incentivise the use of cleaner fuels, such as Kerosene (through the Public Distribution System) and LPG with the implementation of subsidy schemes such as Deepam scheme (Andhra Pradesh /Telangana), and more recent national level schemes such as Rajiv Gandhi LPG scheme and Pradhan Mantri Ujjwala Yojana.

Deepam Scheme

The Deepam Scheme was launched in July 1999 for Below Poverty Line households. The central objectives of the scheme were to (i) reducing drudgery among women and children from wood collection and cooking; (ii) improving the health of household members by reducing ambient concentrations of smoke and other harmful pollutants; and (iii) protecting forests from further degradation. The scheme included rural households (target of 10 Lakh households) as well as urban households (target of 5 lakh households).

Apart from providing subsidised LPG, funded by the Central Government, the scheme also required the government of Andhra Pradesh to provide 5 litres of Kerosene per month for each household. This scheme also aimed to operate through women Self Help Groups.    

The Deepam scheme was unique when it launched mainly because it had components that were not seem in previous fuel subsidy schemes. This included giving a subsidy only as a one off for the initial cost of getting an LPG connection, in addition the scheme was targeted towards BPL households, mainly rural households and used SHGs as a means to identify and allocate these subsidies.

A World Bank report (2002) on the first Phase of Deepam found that the beneficiaries of the scheme benefited from the time saved in from the use of LPG, reduced indoor air pollution and increased cleanliness, and an improvement in their social status. However, most beneficiaries who did use LPG rarely used it as the sole cooking fuel, it was mostly in conjunction with traditional cooking fuels such as fuelwood and biomass. The main reasons for this was that these fuels were still cheaper than LPG, and while the delivery of the LPG cylinders did not cost extra, too many beneficiaries lived too far away for deliveries and had to collect the cylinders themselves. In addition, the 14.2 Kg cylinder was too expensive as many households often could not afford to spend that much money at one go, this was true for the purchase of cookstoves and other required upfront purchases as well. LPG was also used when traditional fuels were not as readily available to use or were difficult to obtain, this was true for the monsoon season where there was less time to collect fuelwood, and reduced availability of dry biomass and fuelwood.

The central drawbacks of the scheme is that it is still too expensive for true BPL households to meet the cost of monthly LPG use, in addition those that sign up for a connection and invest in the procurement of gas stoves and other required materials may still not use LPG once they realise that they cannot afford the monthly LPG cost (Rajakutty et al., 2002). In addition, villages which are too far from distribution centres and where too few LPG users exist, it is often not viable for distributors to deliver refills, making it more costly for the beneficiary to use LPG for cooking.

Rajiv Gandhi Grameen Vitaran Scheme

The Rajiv Gandhi Grammen Vitaran Scheme (RGGLV) was launched in 2009 to ensure LPG connections be given to rural households who did not yet have LPG connections and who were facing trouble accessing LPG because of a lack of distributors in their area. While LPG distributors are required to have a certain operating requirements and infrastructure to legally operate, under the RGGLV scheme these requirements were lowered to make them viably operate in areas with lower populations. This includes the requirement of having monthly refill sales of 2,500; this was reduced to 600 under RGGLV (Saikia, 2015). In addition, the dealerships operating under RGGLV were required to have 50% partnership of women, or in case of unmarried dealers they are required to include their spouses name as a 50% partner. Further, the dealerships would be reserved 25% for SC/ST category, 25 % for defence/handicapped/sports category (IIFL, 2009).

The rural beneficiaries of this scheme would benefit from the lack of upfront connection and regulator cost (Rs. 1,400). However, a noticeable absence of ‘free delivery’ of LPG cylinders was criticised even before the launch of the scheme.

In 5 years of the scheme being launched, 4000 LPG distributors have been set up under the reduced infrastructure requirement as per RGGLV (Saikia, 2015). The selection criteria for distributors has come under question, and by 2014 it is estimated that while the cost of setting up a distribution facility had gone up considerably, the limit of 1800 customers and 600 refills was no longer considered viable. In addition the selection process of new locations of these new dealerships came into question whereas advertised location were sometimes repeated (where a RGGLV dealership already existed) and villages which still required dealerships were not being advertised. In 2015 the scheme was indefinitely put on hold, the reasons cited included the need to make changes in the guidelines for the selection of dealers.

Pradhan Mantri Ujjwala Yojana

In May 2016 the Pradhan Matri Ujjwala Yojana was launched, which aimed to provide 50 million women beneficiaries of BPL households with free LPG connections, the scheme will cost about INR 80 billion over 3 years (The Hindu, 2016). The budget will be procured through savings from LPG subsidies beneficiaries (mostly from urban households) voluntarily giving up their subsidies, this was prompted by a nationwide ‘give-up’ campaign aimed at households which could easily bear the full cost of LPG. More than 1.6 million households had given up their subsidies as of April 2016.

The scheme aims to transfer the subsidy amount of Rs. 1,600, which is the upfront LPG connection cost, directly into the bank account of beneficiaries. It remains to be seen whether this scheme has adequately evaluated other LPG subsidy schemes, but what is immediately clear is that some changes have been made. These include the option of EMI for the beneficiary to procure the gas stove and the first refill, the gas cylinder sizes now also includes the 5 kg option (Pradhan Mantri Yojana, 2016). While the smaller cylinder size can be seen as an improvement from the Deepam scheme, it is not clear under what criteria the different sizes would be given to the beneficiaries, and if they would be given a choice, the official guidelines only state that the sizes would be chosen “depending on the field situation”.


In conclusion, there also needs to be more transparency in how the beneficiaries are selected, the Deepam scheme had the most transparency where only SHGs who met a criteria were allowed to put forth BPL beneficiaries, however a detailed survey still needs to be done to evaluate the success of this method of identification. The RGGLV scheme attempted to address the central problem faced by the Deepam scheme by introducing distributors who were businesspersons from the community (wherein the dealership would be in both the spouses’ names), and who could meet the relaxed infrastructure and capacity guidelines. However, even here what needed improvement was the identification methods used to select distributors, and areas which required these new distributors.

There needs to be a proper evaluation of the past schemes, at present there is a glaring absence of data available to the general public on how successful the schemes have been, this is especially true for the Deepam scheme, which has entered its second phase, however without a comprehensive analysis of Phase 1 it is unclear to what extent the issues of implementation and selection of beneficiaries have been addressed. Hence, a comprehensive reporting mechanism for the current LPG scheme needs to be present, in addition the implementers need to be aware of the pitfalls the previous cooking fuel schemes have faced, even with a lack of comprehensive data some apparent issues include the absence of LPG distributors in less populated areas and sparse use of LPG by beneficiaries.