Muhith hints at CNG price hike again

FE Report Finance Minister AMA Muhith hinted Wednesday at the possibility of further raising the CNG (compressed natural gas) price within this year. "The CNG price should be close to that of diesel," Mr Muhith told newsmen at his secretariat office. Without mentioning any specific time, the finance minister said the CNG price hike could take place by December. About the latest enhancement of CNG price, the finance minister said: "It (the hike) was just a farce." He further said the upward adjustment of CNG price does not give any extra benefit to the people as the diesel price is still a dominant factor for fixing the transport fares -- either for buses or trucks. "Both the bus and truck fares are still determined on the basis of diesel price," he said. But those who have gone for CNG are making extra money, he observed. When his attention was drawn, Mr Muhith ruled out the possibility of any immediate price adjustments of fuel oils. He, however, said the government is moving towards adoption of a formulapolicy for the adjustments of fuel oil prices at the domestic level from time to time in line with their fluctuations in the international market. The finance minister's observation came after the government had already raised the CNG price twice since last May. In September 19 last, the government raised the CNG price to Tk 30 per unit (1.0 cubic metre), representing a 20 per cent hike in prices. On May 12, 2011 the CNG price was increased by 49.25 per cent from Tk 16.75 per unit. Earlier, the government enhanced fuel oil prices on September 18 by a maximum of 19.04 per cent a litre in a bid to reducing its growing subsidy on account of selling petroleum products, mainly diesel and kerosene, in local market at lower than the import costs. With the enhancement, the price of diesel was fixed at Tk 51 per litre, that of petrol at Tk 81, octane at Tk 84, kerosene at Tk 51 and furnace oil at Tk 50 per litre. UNB adds: Country's CNG filling station owners have sharply reacted to the statement made by Finance Minister AMA Muhith who indicated at increasing the CNG price again. The CNG station owners are now planning to call a strike against any government move to raise the CNG price. Secretary General of Bangladesh CNG Association Zakir Hossain Nayan said Wednesday that his organisation has convened a meeting of the executive committee Saturday next to discuss the situation following the finance minister's statement. He said most of the CNG filling station owners have already expressed their opinion in favour of building up a tough movement against any move to raise CNG price again. "Most of our association members have already expressed opinions to call a strike to protest the statement of the finance minister," he said. He said: "Only in September last, the government raised CNG price. Now if the price is raised again, our business will just collapse." Nayan said other stakeholders like transport operators and transport owners will also be affected by any such move to raise the CNG price and finally, the common people will be the victim of such a move. He said that the CNG Association will discuss with other stakeholder organisations to take a common stand on the issue. Nayan said that when the Energy Regulatory Commission is the legal and appropriate authority to take any decision on CNG price-fixing, the finance minister cannot make any such comment on raising the price.