Government will roll out LPG-like DBT scheme for kerosene from 1st of April this year. According to an official release, the scheme will be implemented in selected 26 districts of eight states. These states are Chhattisgarh, Haryana, Himachal Pradesh, Jharkhand, Madhya Pradesh, Maharashtra, Punjab and Rajasthan. Under the scheme, people will buy kerosene at market rate but will get subsidy directly in their bank accounts. The cash subsidy to be paid to users, will be equivalent to the difference between current Public Distribution System price and market rate of kerosene.
The subsidy outgo for kerosene for the financial year 2014-15 was about 24,799 crore rupees.
With a view to incentivize States and Union Territories to implement DBT in kerosene, it has been decided that the states be given cash incentive of 75 per cent of subsidy savings during the first two years, 50 per cent in the third year and 25 per cent in the fourth year. In case, the states voluntarily agree to undertake cuts in kerosene allocation, beyond the savings due to DBT, a similar incentive will be given to those States.

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