ISLAMABAD - The government is likely to increase the price of compressed natural gas (CNG) by Rs 4 a kilogramme for the current month (October) after getting approval from the Economic Coordination Committee (ECC), it has been learnt.
The incumbent government is set to jack up the CNG price following a raise of Rs 4.15 in the price of petrol, sources said, adding that a plan to increase the price of CNG by Rs 4 per kg by imposing petroleum levy had been put on hold for the approval of Economic Coordination Committee (ECC). The imposition of expected petroleum levy and margin of depreciation of the rupee against the dollar would contribute to jack up CNG prices, the sources maintained.
They were of the view that government was all set to impose the levy also on CNG for the current month and was gearing up utmost efforts to maintain the price differential of 55 per cent between CNG and petrol earlier agreed with the All Pakistan CNG Association.
“A formula is prepared to get approval by the ECC to charge petroleum levy on CNG, if the gap between prices of petrol and CNG widens by more than 45 per cent, and is likely to be considered for final nod from the authorities concerned,” an official seeking anonymity informed this scribe on Saturday, adding, “A team under petroleum minister is working out very hard to set how much CNG price can be increased if PL is imposed and also after the determination of the raise in petroleum prices for the present month.”
This hike is also after the appreciation of the dollar, a source said.
It is testimony of the fact that at present, the difference between petrol and CNG prices is 45 per cent, which will widen after the fresh increase in petrol price by Rs 4.15 per litre. Earlier, the petroleum ministry wanted to slap a petroleum levy of Rs 5 per kg on CNG, but the proposal was withdrawn in the face of fierce resistance from CNG station owners, the sources said.
The economic pundits while talking to TheNation said that inflation-hit masses must prepare themselves for another jolt after the raise in the prices of three major POL products as Oil and Gas Regulatory Authority (Ogra) is near to badly hit the consumers of CNG in the country. They argued that this massive hike in the price of CNG would lead to a significant increase in inflation as the travel costs will increase and production costs at industrial units would push the prices of utility items further up. They said there would be a significant increase in inflation as the price of CNG and cost of production on industrial units would significantly go up.
The Nation, Pakistan 2nd Oct-2011