Manjurul Ahsan
The series of increase in prices of fuel oils and power has kept inflation going up, putting fixed and lower- to middle-income people into misery and adding to industrial production cost
After the government has increased fuel oil prices on several occasions in a year, the Bangladesh Energy Regulatory Commission on Thursday increased power prices by 20.67 per cent on average for consumers in two phases — by 13.24 per cent in December and by 7.09 per cent in February.
The commission earlier this year in February also increased the power prices for consumers by 5 per cent.
Mohammad Abul Hashem, a high schoolteacher in Narayanganj, told New Age that every month he needed to increase his family budget significantly as transport fare, goods prices and house rent are going up.
‘You need to keep spending more on transport fare and goods as fuel oil prices have increased. Now power prices have also gone up. I have to spend more on electric bill. I am not sure where other expenses will lead me to,’ he said.
Prabir Mitra, a government official living at Mirpur of the capital, said that his house owner on Thursday night had asked him to pay Tk 1,000 more for December because of the latest power price increase. The house owner said that the
rent should be increased as he would need to pay more for power, for general use and for running pump to lift water.
The government so far has increased the prices of fuel oils the ones that run vehicles and keep stoves and hurricane lamps burning by Tk 12 a litre in three phases since May.
It has also increased furnace oil price by 112 per cent or Tk 29 a litre from Tk 26 to Tk 55 a litre in five phases.
The Exporters’ Association of Bangladesh president, Abdus Salam Murshedy, said, ‘Exporters are struggling with increasing fuel oil prices, bank loan interests and decline in product prices in the European Union and the United States. Now, the power prices have been increased. It will no double speed up the decline in export.’
Zaid Bakht, research director at the Bangladesh Institute of Development Studies, told New Age that power prices were increased as the cost of production had increased. ‘But it will add to inflation.’
According to the latest data available with the Bangladesh Bureau of Statistics, the point-to-point inflation rate increased to 11.58 per cent in November from 11.42 per cent in October because of fuel oil price increase.
Although food inflation slightly declined to 12.47 per cent in November from 12.82 per cent in October, it would take a reverse turn to harm people of lower and middle-income groups, economists said.
Mustafizur Rahman, executive director of the Centre for Policy Dialogue, along with Zaid Bakht blamed the government’s fuel oil-fired rental power solution for the increase in power prices.
Mustafizur said that the rental power had become a heavy burden on the government, suggesting that the government should reduce the production cost rather than increasing power prices to ease the pressure of subsidy.
Shahedul Islam Helal, a former president of the Bangladesh Chamber of Industry, asked what the industrialists would get in return for paying more for power.
He suggested that the power outage should be scheduled and the surcharge on peak-hour power consumption and the 5 per cent of VAT on the bill should be withdrawn.
He said, ‘VAT should be realised for a service. But interrupted power supply is damaging machines and appliances. So the government cannot realise VAT from consumers unless it improves the supply situation.’
Courtesy of New Age
