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VOL. 27, NO. 43, July11 , 2008 (Ashadh 27 2065 B.S.)
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Perennial Problem
Despite series of hikes, people are forced to stay in long queues to get petroleum products
By SANJAYA DHAKAL
"I have been staying in the queue for four hours and still I am not sure if I will get the fuel," said Prakash KC, a motorcyclist standing in a queue in front of a petrol pump in the capital city.
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Petro Product: Short supply |
Like KC, thousands of consumers are compelled to brave the July heat and rain to get few liters of petrol and diesel.
The serpentine queues have become a common scene since last many months – despite the series of hikes in its prices.
The petroleum dealers point fingers at the state-owned Nepal Oil Corporation (NOC) for short supply.
"They have been supplying 60 percent less than the actual demand," said Shiva Prasad Ghimire, president of Nepal Petroleum Dealers' Association (NPDA).
The NOC has been claiming that it is running huge losses due to soaring price of oil in international market and lack of price adjustment back home.
"We are making loss in petrol, diesel, kerosene and cooking gas. Based on July 1 price, in total we are incurring monthly loss of Rs 1.3 billion. That is why we are unable to supply as per the market demand," said NOC spokesperson Mukunda Dhungel.
In the last one year, the NOC has increased the price of fuel four times apart from other three times when it had to rollback the price hike in the face of stiff protests.
Despite such price hikes, the demand for the fuel has not subsided. "The demand for diesel, in fact, has been rising by thirty percent. Because of increasing number of vehicles and use of diesel in farming activities, their demand has grown,' said Dhungel.
At present, there are around five and a half lakh of different kinds of vehicles in the country. And their number is growing in double-digit rate. The easy installments and consumer financing schemes by the banks have also triggered this rise in the number of vehicles.
The growing import bill of petroleum products triggered by ceaseless climb of oil price in the international market has started hitting at the vitals of the economy.
Rameshwore Khanal, Secretary at the Ministry of Finance, has said that the soaring import bill of fuel has started eclipsing the total money the country earns through its exports.
Khanal also presented alarming situation related with decline in exports. "If the trend continues, in the next year we may not be able to purchase even petroleum products from the income from our exports," he said.
He said that based on current world price, the government will have to cough up Rs 70 billion to purchase petroleum products next year. "Whereas our estimates point that we could earn only around Rs 60 billion owing to our total exports next year," he said.
As such, the total export earnings will not be able to pay even single commodity import bill.
"Such a situation points to the very bad shape of our economy," said Dr. Raghab Dhoj Pant, an economist.
