CNG price up by 49.25pc per unit

FE Report

The government Thursday raised the compressed natural gas (CNG) price to Tk25 per cubic metre (cm), a 49.25 per cent hike from the existing tariff of Tk16.75 per unit.

The Bangladesh Energy Regulatory Commission (BERC) announced the new price, effective from Thursday 12 midnight.

"We have increased the CNG price for ensuring its maximum and accurate utilisation for facilitating the national economic growth," chairman of the BERC Syed Yusuf Hossain told journalists at his office in Dhaka.

The state-run energy corporation-Petrobangla, in October last year requested the BERC to raise the CNG price to Tk24.90 per cubic metre for cutting the bloated subsidy on the energy sector.

The BERC, three years back in April 2008, raised the CNG tariff to Tk 16.75 from Tk 8.50 per cubic metre to minimise the losses of the gasoline business by the state-run Petrobangla.

Mr. Yusuf Hossain said the government would earn some extra Tk11.21 billion following the price hike by Tk8.25 on a cubic metre of the CNG from Tk11.29 billion income per year on the existing price.

The country's nearly 600 CNG filling stations sell some 500 cubic metre of CNG per hour to the vehicle owners.

The BERC chairman said the government would bag Tk9.90, the Petrobangla Tk8.10 and the CNG filling station owners Tk7.00 margin for the sale of per unit CNG at Tk25.

From the Petrobangla's income, some Tk2.014 will go to the newly introduced Gas Development Fund of the government, he said.

The chairman said though the CNG price hike can affect the mass transportation including goods and public transport but it would also contribute to check some unusual use of private cars which often trigger traffic jam in the capital.

The cheaper gasoline has encouraged use of private cars and other vehicles in the capital which creates unusual traffic jam.

Supporting the 49.25 per cent CNG price hike, member of the BERC Dr. Selim Mahmud said we had tried to adjust the price of gasoline compared to the price of other fuel here.

"Even after today's adjustment of the CNG price, it is still 71.09 per cent cheaper than the octane price and 47.29 per cent from the diesel price in the local market," he said.

The CNG price in India is 28 per cent cheaper than their existing diesel price, Mr. Mahmud said.

On May 5 this year, the government had also increased prices of diesel, petrol, octane, kerosene and furnace oil by taka two a litre to cut its losses due to higher import cost than the sale price in the local market.

Analysts said the CNG price and the recent other fuel price hike would rasie the inflation further from the existing level.

In March, the point-to-point inflation in the country increased to 10.49 per cent, in two and a half years high since July 2008.

BNP protests raising

CNG price

UNB adds: BNP acting secretary general Mirza Fakhrul Islam Alamgir on Thursday strongly protested 50 per cent rise of CNG price by the government, saying it will augment woes of people.

In a statement he said Awami League government has pushed people into serious sufferings by raising prices of compressed natural gas (CNG), fuel oil and power several times after it assumed office on Januray 7, 2009.

Last week, the government increased fuel oil price with a flat rate of Tk 2 per liter following a substantial raise in power tariff in both at bulk and retailers levels last month.

Fakhrul said: “It is not understandable to people under what policy the government has again increased the price of the compressed natural gas“.

He said it is the manifestation of Awami League‘s ‘fascist behaviour‘ to put people in distress by raising price of per cubic feet gas from Tk 16.25 to Tk 25 at a time.