The government is mulling another round of cooking gas subsidies under the Ujjwala Yojana scheme even as it keenly monitors inflationary pressures on the economy. The scheme offers cheap LPG to women of BPL households.

“The possibility of another round of subsidy for Ujjwala beneficiaries cannot be ruled out. A call would be taken on the amount and timing of its rollout depending on how global and domestic factors play out,” officials said.

Sources indicated that the government is closely monitoring the price situation as lower than normal monsoon is likely to result in the price rise of food grains.

If the Israel-Hamas conflict continues to linger or other nations in the region are involved it would have a significant impact on global crude prices and in turn result in imported inflation.

The increase in LPG subsidy came before the assembly polls to the five states, with speculations rife that the next round of hikes would come before the Lok Sabha elections.

The government had last month increased the subsidy under Ujjwala Yojana to Rs 300 per cylinder, benefiting 9.6 crore families.

The subsidy under the scheme has been raised to Rs 7,680 crore in the current fiscal year from Rs 6,100 crore a year ago.

Economists said inflationary pressure is set to intensify with the kharif output of rice and pulses estimated to be lower from inadequate rains.

Icra chief economist Aditi Nayar said retail inflation will remain volatile in a wide range until June next year.

However, she does not expect further monetary tightening from the Reserve Bank of India.