fuel price hike - Dhaka Mirror

Repeated fuel price hike, political instability to hit GDP growth: DCCI

Admin — Sun, 20 Jan 2013 12:38:58 +0000

The Dhaka Chamber of Commerce and Industry on Saturday expressed its concern that frequent price hike of fuel oils and electricity and political instability might impede achievement of the government’s target of 7.2 per cent GDP growth for the current fiscal year.
‘Achieving the projected 7.2 per cent growth would be very challenging mainly due to a slower growth in the industrial and service sectors, internal and external demand, and overall investment,’ DCCI president Sabur Khan said at a press conference at the chamber’s auditorium in the city.
The country would be able to achieve the projected growth if the government takes precautions, but it would fail to attain the growth if political confrontation intensifies and the trend of raising fuel oils and electricity prices continues, he said.
He urged both ruling and opposition parties to ensure political stability for higher growth and economic advancement.
‘The political situation prevailing in the country is not conducive to business.’
Maintaining political stability is one of the main incentives for business and political stability is a must for the country’s balanced development, Sabur said.
Quoting a recent study conducted by the DCCI, Sabur said, ‘The economy faces a loss of around $200 million for one day general strike.’
The government can build a bridge on the River Padma with the money the country loses for general strike in 15 days, he said.
The DCCI president said that entrepreneurs were unable to run or expand their business activities as they were not getting enough bank loans due to a higher interest rate.
‘The interest rate should be cut down to single digit.’
Demanding immediate gas and electricity connections to the newly-established industrial units, he said that many factories remained non operational due to the absence of power connections.
On the issue of GSP facility in the USA, he said that the government should resolve the problem through negotiation.
‘The export earnings, which remained sluggish due to the global recession, would face crisis, if the USA cancels the facility for the Bangladeshi products.’
A cancellation of the GSP facility in the US market will also put a negative impact on the Bangladesh’s exports to other countries, he said.
Urging the government not to increase the prices of fuel oils and electricity again, he said that the price hike of fuel oils and electricity several times by the current government had already increased the cost of production and pushed the local industries towards severe challenges in the international market.
To make the share market vibrant, he proposed the government reduce tax rate on profit of the listed companies, encourage non-listed and new companies to be listed and attract people by reducing bank interest rate to invest in the market.
He also demanded withdrawal of the service charge on check clearing under Bangladesh Automated Clearing House and tax on opening of local letter of credit imposed by Bangladesh Bank recently.
These charges will put additional burden on the businessmen and will discourage people to transact through the banking channel, he said.
DCCI senior vice-president Nessar Maksud Khan and vice-president Absar Karim Chowdhury were present, among other, at the conference.

Courtesy of New Age

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Chaos over bus fares

Admin — Tue, 15 Nov 2011 15:19:44 +0000

No govt decision yet, but operators charge commuters higher
Ignoring the government’s directive, many bus operators have already started charging extra fares following the latest fuel price hike. Passengers yesterday alleged that the operators are charging them higher fares inconsistent with the rate of oil price rises.
The launch owners, though, are pushing for an increase in fares up to 70 percent. On Sunday, they submitted copies of a letter to the shipping ministry and Bangladesh Inland Water Transport Authority (BIWTA) demanding 53 to 70 percent hikes in fares.
The government on Thursday raised fuel prices by Tk 5 a litre. It asked bus operators not to charge extra fares until a new fare chart is announced.
Within days of hiking oil prices, altercations between passengers and bus staff have become a routine scene in buses plying in and outskirts of the city.
“I usually travel from Azimpur to Mirpur in Metro bus service for Tk 10. But the operator is charging Tk 12 for the same distance citing the fuel price hike,” said Dhaka University student Saurav Kumer Dey.
Transport owners and workers said they would have to incur loss if the fares are not revised.
“It is impossible to operate buses on pervious ticket rates. But my staff have to scuffle with the passengers for the extra fares,” said Mohammad Hossain, owner of a bus plying on Gulistan-Kanchpur route.
Previous fare from Gulistan to Kanchpur was Tk 15, but now it is Tk 18, he added.
Buses plying on the outskirts of the city and on the highways are no exception.
“I regularly travel from Gabtoli to Ashulia for Tk 40. But I had to pay Tk 50 today (Monday),” said businessman Shimul.
Some operators on Dhaka-Khulna route are charging Tk 350, though the usual fare is Tk 300, complained Badal, who came to Dhaka from Khulna yesterday.
Talking to The Daily Star, Bangladesh Sarak Paribahan Samity Secretary General Khandaker Enayetullah expressed his ignorance about charging of extra fares. “If any bus operator is found charging extra, action will be taken against him.”
Launch owners have demanded for increasing the fares to Tk 2.00 from Tk 1.30 per kilometre for travelling the first 100 km, Tk 1.70 from Tk 1.00 for travelling over 100 km and to Tk 20 from Tk 12 as the minimum fare.
Bangladesh Inland Waterways (passenger carriers’) Association leaders claimed the shipping minister will sit with them on November 23 to discuss the adjustment in launch fares.
Ministry officials, however, said they did not know about the date of the meeting.
A BIWTA official mentioned that new launch fares will be fixed after talks with all the stakeholders of the sector. “We will also analyse the percentage of increase in bus fares before taking any decision for hiking launch fares.”
Earlier the government increased bus fares on September 19 and launch fares up to 20 percent on June 14.

-With The Daily Star input

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Bus fare hike not now

Admin — Mon, 14 Nov 2011 05:25:02 +0000

Govt wants to re-fix fares after further discussion, CNG price hike
The government yesterday decided not to increase transport fares right now although transport owners have been pushing for a hike following the fuel price hike Thursday night.
The fares will be increased, likely next month, after another round of fuel and CNG price hike, said a communications ministry official.
However, the government compensated the owners by assuring them of meeting some of their demands, including reduction of import taxes on tyres, tubes and small vehicle parts from 25 to 12 percent, setting up of a bus terminal in Phulbaria of the capital and declaring the transport sector as an industry.
A meeting of communications ministry officials and leaders of different transport owners and workers’ associations and consumer association at the ministry office decided that the costing evaluation committee, headed by the chairman of the Bangladesh Road Transport Authority (BRTA), would soon adjust the transport fares.
“Everyone is happy with the outcome of the meeting, which largely discussed the possible adverse reactions of passengers if transport fares are increased once again,” said the ministry official, adding that the BRTA had tabled a draft list of increased fares, which the communications ministry rejected as the rates in the proposal were very high.
A bus owner, who attended the meeting, said, “Two ministers [the shipping minister and the communications minister] urged us not to increase bus fares right away. But we will have to bear losses if we maintain the previous rates. So, if the government does not increase transport fares soon we will be forced to suspend our operations.”
Emerging from the meeting, Communications Minister Syed Abul Hossain said the costing evaluation committee would soon convene to re-fix transport fares after assessing the fuel price along with existing realities.
“We will keep passengers’ welfare in mind while readjusting the fares. No additional fares will be charged until the committee fixes it,” he told reporters, adding that everyone at the meeting agreed on this point.
When informed that many transport owners had already begun charging extra fares, Khandaker Enayetullah, secretary general of Bangladesh Sarak Paribahan Samity, said transport owners have been requested not to take extra money from commuters till the fares are readjusted.
“We have not proposed any new rate. It will be difficult for us to keep buses on the roads if the new fares are not consistent with the fuel price hike and other relevant issues,” he told The Daily Star.
According to BRTA records till June 2011, a total of 75,196 registered buses and minibuses ply across the country, which largely contradicts Khandaker Enayetullah’s statistics about the country’s having around 1.5 lakh buses and minibuses.
Chaos descended on the transport sector when the government re-fixed transport fares following an increase in fuel oils and compressed natural gas (CNG) prices in September. Although the communications ministry re-adjusted the fares, many transport operators have been charging fares at will.

Courtesy of The Daily Star

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Fuel prices hiked

Admin — Mon, 19 Sep 2011 04:14:24 +0000

The government increased for the second time this year the prices of all fuel oils, including diesel, by Tk 5 per litre and that of furnace oil by Tk 8 a litre with effect from Sunday midnight under heavy pressure from the International Monetary Fund.
The price of diesel and kerosene has been raised from Tk 46 to Tk 51 a litre, furnace oil from Tk 42 to Tk 50, petrol from Tk 76 to Tk 81, and octane from Tk 79 to Tk 84.
The latest price adjustment comes four and a half months after the previous fuel price hike by Tk 2 per litre on May 6.
Although energy officials said that the government raised the fuel oil prices between 6.33 per cent and 19.05 per cent to offset its losses due to the global oil price rise, finance minister AMA Muhith had hinted at the price hike last week after a meeting with a visiting delegation of the IMF.
The government has been negotiating with the IMF for a $1 billion loan for budgetary support, to which the IMF has tagged a number of conditions, including price hike of energy and power.
The price hike of fuel oil came at a time when Muhith left Dhaka for Washington to negotiate with the IMF for the loan and with the World Bank for other budgetary support.
Economists expressed their concerns at the oil price hike, saying it would add fuel to the growing inflation which at the moment stood at 11.29 per cent, although the IMF and a few other lending agencies claimed the hike would not have any impact on inflation.
Bangladesh Institute of Development Studies research director Zaid Bakht told New Age that the oil price hike was not unexpected since the government was under a huge budgetary pressure to make payment for fuel-oil-based rental power plant projects, while lending agencies like the IMF were also tagging conditions of fuel price hike to the $1b loan.
He suggested that the government should achieve the capability to rein in food inflation, which had already crossed 10 per cent, by ensuring enough supply of essential commodities to the market.
With this, the government so far has increased the price of furnace oil by Tk 24 per litre this year – from Tk 26 to Tk 35 on January 24, then to Tk 40 on April 7 and now to Tk 50.
Similarly, the prices of diesel and kerosene were increased by Tk 7 per litre in two phases.
The government, earlier, decreased the diesel and kerosene price from Tk 46 to Tk 44 a litre on January 12, 2009 as the price of crude oil on the global market slumped to around $39 per barrel.
Bangladesh Petroleum Corporation chairman Muktadir Ali told New Age that the corporation would have to count losses by Tk 20 for a litre of diesel or kerosene and Tk 8 for a litre of furnace oil, if the oil prices remained stable at the stage even after the hike on the retail market.

-With New Age input

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