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PO V Interview PDF

IBPS PO V Interview Materials


PaHaL (Pratyaksha Hastaantarit Laabh)
PaHaL (Pratyaksha Hastaantarit Laabh) is the abbreviated alternate Hindi name for the Direct Benefit
Transfer (DBT) Scheme existing in India for the direct cash transfer of subsidy for Liquefied Petroleum Gas
(LPG) used in household cooking. As the name suggests, LPG consumers who join the PaHaL scheme will
get their LPG cylinders at market price and receive LPG subsidy, as per their entitlement, directly into their
bank accounts.
DBT is designed to ensure that the benefit meant for the genuine domestic customers reaches them
directly and is not diverted. By this process public money is saved, just as fake and duplicate connections
cease to exist. Under DBT, subsidy is available only to those who opt for it, thus ensuring self-selection
and avoiding universal coverage. Capping the price of LPG for household consumption had also led to
production distortions and stress on distribution infrastructure. DBT intends to correct such distortions
in the industry.
The PaHaL scheme has been acknowledged by the Guinness Book of World Records for being the largest
cash transfer program (households) with 12.57 crore households receiving cash transfer as of 30 June,
2015.
As on 5 December 2015, around 14.62 crore LPG consumers have joined the PAHAL scheme and are
receiving the subsidy directly into their bank accounts. The number is set to grow, as more and more
consumers register for LPG subsidy, given the fact that LPG penetration is still low in India.
Similar programs exist in other countries, such as China, Mexico and Brazil.

To arrive at a viable and sustainable system of pricing of petroleum products, Government had set up an
Expert Group under the chairmanship of Dr. Kirit Parikh which submitted its report in February 2010. In
the light of Governments budgetary constraints and the growing imperative for fiscal consolidation, and
the need for allocating more funds to social sector schemes for the common man, the Government
decided that the pricing of petrol and diesel, both at the refinery gate and the retail level will be marketdetermined. As a first step, petrol prices were deregulated on 25 June 2010 while slowly increasing the
prices of other subsidised products like diesel, LPG and Kerosene.

Features
The DBT Scheme for LPG was launched initially on 1 June 2013 by linking the LPG subsidy solely to
Aadhaar the biometric based unique identity number provided to the Indian citizens and covered a
total of 9.55 crore LPG consumers (out of the approximate 15 crore LPG consumers), in 291 districts of
the country (which had relatively better distribution of Aadhaar), as at the end of December 2013 - i.e.,
over half of the LPG consumers in the country. All Aadhaar linked domestic LPG consumers were to get
before delivery, an advance in their bank account (around Rs 568/-) as soon as they book for the first
subsidized cylinder. As soon as the first subsidized cylinder is delivered to such consumers, the next
subsidy will again get credited in their bank account, which can then be available for the purchase of the
next subsidized cylinder at market rate, and this goes on till the specified cap with respect to number of

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PO V Interview PDF

subsidised cylinder is reached. All LPG consumers who had not linked their Aadhaar number to LPG
consumer number and their bank account were given three months grace period from the date of launch
to do so. After the end of the grace period i.e., w.e.f. 1 September 2013, LPG cylinders were to be sold to
all domestic LPG consumers at market price. However, the subsidy were to be transferred to only those
who had linked Aadhaar number to LPG consumer number and Bank account and others were not to get
any subsidy.
With the new Government coming to power in May 2014, based on the difficulties faced by the citizens,
the DBT was re-launched as `PaHaL Scheme in 54 districts of the country on 15 November 2014 and
launched the same in the remaining 622 districts of the country on 1 January, 2015. Thus, the PaHaL
Scheme is presently applicable in all 676 districts of the nation.
Under PaHaL, all domestic LPG consumers were given two alternatives. If LPG consumer has Aadhaar
number, he/ she will have to link it to his/ her LPG consumer number and bank account. Alternatively, he/
she can link his bank account directly to his LPG consumer ID.
All LPG consumers, who had not joined the PaHaL/DBT scheme, got another grace period of three months
from the date of launch to join the scheme. During the grace period such consumers were entitled to get
LPG at subsidized price. Additionally, a period of three months beyond grace period, known as parking
period, was given to LPG consumers for joining the scheme. During parking period such consumers were
to get cylinders as per their entitlement at market price and subsidy was kept parked with Oil Marketing
Companies (OMCs). This parked subsidy would be released as soon as consumer joins the scheme.
However, if a consumer joins the scheme after parking period, the parked subsidy would lapse and
consumer would get subsidy from prospective date only.
From 1 July 2015 onwards, consumers who still have not joined the scheme will get the cylinder at market
price only and subsidy will not be admissible. Subsidy will be transferred only to the bank account of those
consumers who have joined the scheme prior to 30 June 2015. Any consumer joining the scheme after 30
June 2015 will get permanent advance and subsidy with prospective effect.

Estimated Savings from DBT in LPG


DBT scheme has enabled substantive savings in subsidy on supply of LPG to the households. As on 1 April,
2015, there were 18.19 crore registered LPG Consumers and 14.85 crore active consumers implying a gap
of 3.34 crore consumers which are duplicate / fake / inactive accounts blocked under PAHAL Scheme and
related initiatives. If we take into account the quota of 12 cylinders per consumer and the average LPG
subsidy of Rs.366 per cylinder for the year 2014-15, estimated savings in LPG subsidy due to the blocking
of 3.34 crore accounts work out to Rs.14,672 crore, during that year. Further, as on 5 December 2015,
out of a total of 16.27 crore active consumers, 14.62 crore consumers are availing subsidy resulting in
further subsidy saving for 1.65 crore consumers who have opted out of the scheme.

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Give It Up Campaign
The PaHaL scheme was accompanied by a "Give It Up" campaign requesting people to voluntarily give
up their LPG subsidy, if they could afford to do so. Prime Minister Narendra Modi appealed to the rich to
give up their subsidies in order to benefit the poor. Modi stated, "Give up voluntarily. If one crore people
give up this gas cylinder subsidy ... one crore poor families who burn firewood, which leads to
deforestation, carbon emission (and) their children grow up in smoke ... The cylinder (subsidy) you give
up should reach to the house of that poor."

By of 28 July 2015, 13,86,885 customers of Bharat Gas, HP Gas and Indane voluntarily gave up their LPG
subsidies, resulting in an estimated savings of 2.22 billion (US$33 million) assuming each customer
consumed 8 cylinders annually at the average subsidy rate of 200 (US$3.00) per cylinder.

As of 16 November 2015, 4,694,129 LPG consumers have voluntarily surrendered their subsidies.

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