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One commodity, one price policy for gas

March 16, 2019 00:00:00

Recently, Bangladesh Energy Regulatory Commission (BERC) declared that the tariff for fuel gas should be raised for different consumers. BERC started the public hearing for this on March 11.

The industrial development so far achieved in Bangladesh is not satisfactory. All the industrial units are concentrated in and around Dhaka and Chattogram districts as these areas have been enjoying very low cost fuel -- natural gas. Most of the citizens within and nearby these two districts are the direct beneficiary of industrial development.

Availability of fuel gas at very low price is one of the significant factors for localisation of industrial units in two regions of Bangladesh. Government has the responsibility to develop a congenial environment to set up industrial units in every region of the country. As gas supply in every region was not possible and will not be possible in near future, government has to make alternative arrangements to ensure level playing field for industries. The industrial units, those consuming liquid fuel, cannot compete with units that consume low priced fuel like gas in Dhaka and Chattogram. To develop all geographic regions, price differences between gas and liquid fuel needs to be eliminated gradually. 'One commodity, one price' policy needs to be adopted to ensure natural justice.

In Bangladesh, eight different fuel gas prices have been prevailing for decades and it needs gradual streamlining. Fuel gas prices in Bangladesh needs a basic reform. BERC may make a policy of single price at retail level irrespective of consumer for fuel gas. To implement the policy and to balance the imported liquefied natural gas (LNG) price, step-by-step price increase may be effected. For example, at the first stage gas price for commercial, CNG and household use may be kept unchanged. For all other purposes, a single price may be fixed taking into consideration the imported LNG cost. The price may be fixed at a rate under which the organisations can operate at marginal profit basis.

Md Ashraf Hossain

Aftab Nagar, Badda, Dhaka-1212


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