The Aadhaar-linked Direct Benefit Transfer scheme for reducing leakages in Liquified Petroleum Gas (LPG) subsidies has been widely advertised as a phenomenal success and has been used to promote Aadhaar and DBT in other spheres by prominent government officials. However, an analyses of various studies and data shows that the government’s tall claims of savings cannot be confirmed and leaves much to be questioned.

In our article “Subsidies for Whom? The Case of LPG in India” (EPW, 3 November 2012), we demonstrated convincingly that the distribution of liquefied petroleum gas (LPG) uptake in India is heavily skewed in favour of the urban affluent and argued that the state policy of capping the subsidies to six cylinders per household per year was thus in the right direction. On account of their negligible current usage of LPG, poor households will be largely unaffected by the subsidy cap.