Tamil Nadu Assembly elections | Can the State afford LPG subsidies?

Keeping in thoughts the spike in the costs of liquefied petroleum gasoline (LPG) cylinders that’s hurting customers and hoping to hit the proper chord with the center class and the decrease center class, political events have promised voters a subsidy on the refills. A home cylinder with 14.2 kg of gasoline is offered at ₹835 in Chennai (as on March 1), and the worth varies in keeping with the bottling plant. The subsidy is a meagre ₹25 a cylinder.

The DMK has promised to present ₹100 per cylinder. The State has over 2.20 crore LPG connections. If two crore customers get ₹100 per cylinder a month, it quantities to ₹200 crore. Besides subsidising LPG cylinders, the DMK has promised to cut back the costs of petrol and diesel, which means a substantial dent in the State’s income.

Similar is the case with the AIADMK’s promise of six free cylinders a 12 months. With ₹800 as a base worth per cylinder and a pair of crore household playing cards, will probably be ₹1,600 crore in expenditure each two months. In its manifesto launched on Sunday, the celebration has introduced that it’s going to take steps to extend the amount of subsidised diesel and kerosene provided to mechanised and country-craft fishermen.

An oil trade professional stated that after COVID-19, the scenario was so dangerous that even the Centre was not capable of improve the subsidy. “They are slowly reducing subsidies and government interference in many sectors. In such a situation, these promises don’t seem to be keeping the State’s financial well-being in mind,” he stated.

A former IAS officer and stated they might solely lead the State to a monetary mess from which it couldn’t be retrieved. “We are now a power surplus State. These promises, if implemented, would lead us to a situation wherein we won’t be able to pay our power dues and we will be pushed back to the dark ages,” he stated. Another former official stated it may even result in the chopping down of capital expenditures and have an effect on the primary companies like ingesting water provide.

However, one other former official stated the events which have made such guarantees ought to know from the place to lift funds. “Raising the prices of liquor and municipal taxes would be the possible avenues. Since the State already has good infrastructure, it won’t have to cut down on anything. It is only the question of maintaining what is in existence,” he stated.

Former IAS officer M.G. Devasahayam recalled how in 2016, too, each events had introduced many freebies. “A few of us former officers gave a strongly worded letter to the Election Commission saying it violated the model code of conduct. The Commission asked the parties to financially justify their promises, which they could not. The present promises, too, are violation of the code,” he stated.