Ujjwala LPG Subsidy Cut: Will Beneficiaries Pay More As Subsidised Cylinders Drop From 9 To 4?

The government has reduced the number of subsidised LPG cylinders to four per annum from nine earlier for all Pradhan Mantri Ujjwala Yojana (PMUY) beneficiaries, which will increase the cooking fuel burden on millions of low-income households. The decision came within a week of the cooking gas prices being increased by Rs 29 a cylinder – the second increase in three months amid spiralling global fuel rates. Existing beneficiaries of PMUY will continue to get Rs 300 per cylinder under Direct Benefit Transfer (DBT), but it would now be only for the first four refills per year. The subsidy amount per cylinder remains unchanged. However, with the decreased number of refills, the total annual household subsidy in this regime comes down from Rs 2,700 to Rs 1,200 in the changed subsidy regime. The change has once again raised concerns about whether affordable clean cooking fuel is available for the economically weaker sections of society, even as the government clarified that this will be in line with actual usage while controlling the subsidy burden owing to high global prices of LPG.

PMUY beneficiaries are entitled to receive the DBT subsidy of Rs 300 per cylinder for the first four refills of a fiscal year. Before this amendment, they were entitled to get an Rs 300 subsidy for the first nine cylinders a year.

As per the amended scheme, the maximum subsidy per household a year would stand at Rs 1,200, down from the previous Rs 2,700 – a dip of Rs 1,500 a year.

This amendment comes in the wake of a hike in domestic LPG rates on June 7. Oil marketing companies had increased the prices of a 14.2 kg domestic LPG cylinder by Rs 29 on June 7. This was the second hike in LPG prices in three months, following a Rs 60 increase in March.

Officials attributed the decision to a change in consumption patterns of PMUY beneficiaries and, to an extent, to rising global LPG rates.

Officials said the average household under the PMUY consumes about four LPG cylinders annually. The government says it is reducing subsidy support to four cylinders and will link subsidy support to actual usage rather than to refills that many households may never buy.

At the same time, international LPG prices have jumped sharply.

Officials said that the Saudi Contract Price (CP), a key global benchmark used for LPG pricing, has increased by about 46% since February. The government said the actual cost of supplying a domestic LPG cylinder has now crossed Rs 1,600, and consumers are paying prices substantially lower.

Oil marketing companies are reportedly facing an under-recovery of almost Rs 700 per domestic cylinder.

As per PM Ujjwala Yojana, a woman adult of 18 years and above belonging to a poor household can apply for a free LPG connection. As per the rules and guidelines of PMUY, beneficiaries are identified based on a declaration of deprivation submitted as per format.

No other member from the applicant’s household must be already holding an LPG connection in their name. Households with existing connections are not eligible to receive the benefits of the scheme.

Beneficiaries get an LPG connection without paying any security deposit and without installation charges. The package for beneficiaries comes with a 14.2 kg or 5 kg LPG cylinder, a domestic pressure regulator, a 1.2-metre Suraksha hose pipe, a DGCC safety booklet, free refill(s) and a free two-burner gas stove.

The government covers the expense of all these things. The beneficiaries do not have to pay anything to the LPG distributor for the above connection package.

The beneficiaries of PMUY will continue to get LPG cylinders at much lower rates than the regular consumers even with less subsidy support.

Currently, a PMUY beneficiary pays an effective price of around Rs 642 for a 14.2-kg cylinder after subsidy, whereas a general consumer in Delhi pays about Rs 942.

However, beneficiaries must pay market price for any refills beyond the first four subsidised cylinders in a year.

For households using more than four cylinders a year, the effect could be substantial.

The effect of this decision is to directly impact the pockets of the households, especially the rural and low-income families who had to shift their traditionally used fuel – firewood, coal and cow-dung cakes – to LPG under Ujjwala.

Many families may still be under the four-cylinder limit and thus see little change in actual subsidy receipts. But for larger households and families that use more LPG, the annual fuel cost could be higher.

The timing, too, is significant.

LPG prices have risen twice in three months, with other household costs like food and transport still high. Any reduction in subsidy support adds to the financial burden on weaker household segments that rely on LPG for their daily cooking.

Experts said the rising consumer spending on LPG may dissuade lower-income households from purchasing refills. This may threaten the government’s end goal of promoting more widespread use of cleaner cooking fuel.

The move reflects the government’s attempt to balance welfare spending with rising energy costs.

The Ministry of Petroleum and Natural Gas had contended that the prices of domestic fuel are fixed by international markets and that the government had absorbed the increase in costs rather than passing the entire burden on consumers.

The ministry also added that India is still receiving petroleum cargoes without disruption, and there is no shortage of LPG in the country at present despite geopolitical tensions in West Asia.

The ministry recently defended the scheme in a post on X:

“Under Pradhan Mantri Ujjwala Yojana, more than 10.5+ crore free LPG connections have been provided to women, ensuring access to clean cooking fuel across the country. Eligible PMUY beneficiaries also receive a targeted subsidy of ₹300, making clean energy more affordable for families. A transformative journey of empowerment, dignity and Garib Kalyan.”

Under Pradhan Mantri Ujjwala Yojana, more than 10.5+ crore free LPG connections have been provided to women, ensuring access to clean cooking fuel across the country.

Eligible PMUY beneficiaries also receive a targeted subsidy of ₹300, making clean energy more affordable for… pic.twitter.com/2bDh5rB7XJ

— Ministry of Petroleum and Natural Gas #MoPNG (@PetroleumMin) June 8, 2026

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The subsidy structure under the PMUY has undergone a lot of changes in the last few years:

The latest revision has the steepest cut in the number of subsidised refills available under the scheme, though the subsidy amount per cylinder has not changed.

The change is expected to result in lower government spending on subsidies at a time of rising global energy prices and continuing pressure on public finances.

But for consumers the announcement comes as another blow after LPG price hikes in succession.

The important question is whether cutting the subsidies to just four cylinders would still help safeguard the most vulnerable and also allow the government to manage fuel inflation. The decision of this question could determine whether millions of Indian households can afford clean cooking fuel in the coming years.