Gilani offers Rs 3 for 3 gas-less days

In a transparent but largely unsuccessful bid to soothe the public and political backlash from the Economic Coordination Committee (ECC)’s decision to increase the gas holidays at Compressed Natural Gas (CNG) filling stations to three days a week in Punjab and two days in Sindh, Prime Minister Yousaf Raza Gilani decided on Thursday to decrease the prices of petroleum products to “compensate” for the increased number of days people would have to suffer without CNG.
At a time when opposition parties are flexing their muscles to take on the government after the Muttahida Qaumi Movement left the coalition, the government’s move comes as a desperate bid to quell the outcry at the ECC decision, which refrained, however, from increasing gas prices for domestic and industrial consumers.
Petroleum Minister Dr Asim Hussain had announced on Wednesday that a massive increase in gas prices was on the cards in the ECC meeting. “Fearing that the massive increase proposed in gas prices for various consumer slabs ranging from 10 percent to 100 percent may expedite formation of a grand opposition alliance against the government, the ECC delayed the decision,” an official source told Pakistan Today. He said it was “a purely political decision”.
The prime minister ordered the price of petrol to be decreased by Rs 3 per litre, High Speed Diesel by Rs 2 per litre and Light Diesel Oil by Rs 1.13 per litre, while no change was made to the prices of kerosene. After the price reduction, petrol would be available for Rs 83.71 per litre, High Speed Diesel for Rs 92.11 per litre and kerosene for Rs 84.65 per litre from July 1 (today).
The National Electric Power Regulatory Authority (NEPRA) did not lag behind, as it also announced a decision to increase the power tariff by Rs 0.61 per unit under the fuel price adjustment for distribution companies. The tariff would be applicable from July 1 as well. Water and Power Minister Syed Naveed Qamar had chaired the urgent ECC meeting in the absence of Finance Minister Dr Abdul Hafeez Sheikh. The main agenda before the committee was the increase in gas prices, gas load-management plan, allocation of gas to IPPs and the blending of furnace oil. A statement issued by the Finance Ministry said that at the request of the Petroleum Ministry for the revision in gas sale prices, the committee deferred the proposal for the next three days so that the matter might be discussed at the cabinet level or with the prime minister. The committee, however, accepted the economic rationale for the revision of gas sale prices and for the removal of distortion in the prices.
However, the official source said that the matter was delayed because of the absence of the president and finance minister. He said that the business tycoons were opposing the increase in gas prices, which would increase their cost of production.

They might join up with the beleaguered opposition parties to give a tough time to the government and force it to withdraw the decision, he said. The final decision would be taken by the president, he added.
The ECC approved the uniform natural gas load management policy proposed by the Petroleum Ministry. It was decided that gas supply to two independent power producers (IPPs) would continue for the next five months and the other two IPPs would be asked to resort to other fuels and they would be given the price differential. The ECC also approved modification of tariffs by NEPRA allowing operation of gas-based IPPs on back-up fuel (HSD) with full cost recovery, for the period in which gas was not available to them.
Under the policy, curtailment of gas supply to CNG stations would be for three days for Punjab and two days for Sindh. The gas saved would be used for power generation in Sindh and to facilitate the fertiliser, industrial and power sector in Punjab on an equitable basis.
The meeting approved furnace oil blending as this project would lead to increase in investment in the oil sector and create additional employment opportunities. The ECC told the Petroleum Ministry to ensure a proper monitoring system.
The monitoring system would function under the supervision of the Oil and Gas Regulatory Authority (OGRA) and Hydro Carbon Development Institute of Pakistan and the IPPs would be the consumers.
The ECC accorded a no-objection certificate to Petroleum Ministry for the award of UCH-II development project to be undertaken by Khan Research Laboratories (KRL). KRL has already shown its acceptance to undertake the project by making the lowest bid to ensure its completion within the stipulated time. Additional security issues for Uch Power Project were also approved.
Ramadan relief package: The meeting also approved a Ramadan relief package, under which subsidies of up to Rs 2 billion would be provided on essential food items available at Utility Stores throughout the country.
The meeting approved income tax exemption for the Water and Power Development Authority Second Sukuk Company Limited, which had already been approved by the Finance Ministry.
The re-lending of Keyal Khawar Hydro Power Project was also approved.
APCNGA rejects: The All Pakistan CNG Association (APCNGA) strongly condemned the ECC decision despite stay orders from the Sindh High Court against gas load shedding. Representatives of the APCNGA met the petroleum minister and secretary to stop the decision. The association would decide its future strategy on Monday, a statement said.