Economists and experts have expressed mixed reactions over the latest hike in electricity and gas prices.
Some of them argued that there are justifications for the price hike on the ground of substantial subsidy, being provided by the government, especially for the power sector.
Some others, however, opined that domestic consumers will bear the brunt of the tariff hike that came as a result of 'imprudent' government policies regarding power purchase from rental power plants.
But they are in agreement that the latest hike in electricity and gas tariffs has come as a shock, primarily for domestic consumers and small traders.
Bangladesh Energy Regulatory Commission (BERC) on Thursday increased the electricity tariff by 2.97 per cent and that of gas by 26.29 per cent for retail customers, effective from September 01.
Customers will pay Tk 600 and Tk 650 per month for single gas-burner and double gas-burners respectively.
At present, the tariff for single-burner is Tk 400, and Tk 600 for double-burners.
Dr M A Taslim, professor of Economics of University of Dhaka, said ultimately common people will have to bear the outcomes of rise in the government expenditure.
"There is an annual budget allocation for power plants. So the government has to realise the sum from the people."
Dr Taslim said if the government continues encouraging rental power plants instead of large plants, subsidy for electricity will go up.
"If the subsidy for power production goes up, the common people have nothing to do but to pay."
Instead of cutting cost of production and miscellaneous expenses of the state-owned power companies and the rental plants, the government is burdening common man to bear the cost, he added.
On the other hand, Dr Ahsan H Mansur, executive director of Policy Research Institute of Bangladesh (PRI), said the electricity tariff revision is minimum, and it will not affect the overall price level.
"In my view, it will have a dampening impact on inflation, as the existing rate of inflation remains high."
"The rise in electricity prices can be accepted, if the government liabilities are considered." Dr Mansur said gas prices in Bangladesh remained low than other countries.
Prices of liquefied petroleum gas (LPG) have been maintaining a high level in the country despite its price fall in the international market.
Khandker Golam Moazzem, additional director of Centre for Policy Dialogue (CPD), said the revision would not have emerged as a burden, if the government would reduce oil prices simultaneously.
"We think there is necessity for revision of gas prices. But if the government made downward adjustment in oil prices, there would not be any impact on common people."
He said the government should make downward adjustment in oil prices in context of its price fall in the international market to reduce public woes.
On the other hand, Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) in a statement hailed BERC for giving directives to the departments concerned to expedite giving power connections to the industrial units, which have long been waiting for it.
jasimharoon@yahoo.com
