Mumbai Dec 30 (KNN) The Indian Currency rating agency (ICRA) estimated that Government's step to stop the LPG subsidy to the consumers with taxable income of more than 10 Lakh per annum may result in saving Rs. 500 Crore for the Government
 
"The savings in LPG subsidies for the government could be up to Rs 500 crore if subsidy is stopped for this category households, which may have consumption of 1.25 to 1.5 times than average consumption," a statement from ICRA said.

Further, it may not have an adverse monetary impact for consumers as the current subsidy levels have been low, as per the ICRA.

The statement said that It may be an opportune time to stop LPG subsidy for the high income consumers as the current subsidy levels on LPG are low (Rs 150-190/cylinder over the last 3 months).

Also, there could be material savings in LPG subsidies if the plan is implemented on a larger scale with a lower income threshold as LPG is used highly in urban areas, which have large population of consumers who can afford unsubsidised LPG prices, ICRA further said.

Assuming consumption of one cylinder every 45 days, the impact on the household budget could be limited to Rs 100-125 per month at the current level of global crude oil and LPG prices, the statement explained.

However, the outgo could be higher if the oil prices were to recover to elevated levels in future. (KNN Bureau)