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| Kathmandu, Saturday March 22, 2003 Chaitra 08, 2059. |
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NOC and oil
The first repercussions of the strike on Iraq by
the US and its allies were felt even in countries like Nepal where there has been a panic
buying of main petroleum products such as petrol, diesel and kerosene. By mid-day
Thursday, the petrol pumps in the capital were reporting that they no longer had any
stocks left to sell. The Nepal Oil Corporation (NOC) that has the monopoly on the main
petroleum product business should have known well in advance that the war in West Asia was
coming, should have planned well and should have been prepared for it. The
government-owned oil monopoly may well have done so. For it officially asserts that it has
adequate supplies to last for at least a month. But panic buying and even hoarding will
continue as long as the conflict in West Asia goes on and oil supplies are affected one
way or another. While it might be argued that we could do with less polluting vehicles on
the roads of the Kathmandu Valley, the short supply of petroleum products also affects the
much needed developmental activities, including the reconstruction of infrastructures
destroyed by the armed Maoist insurgents. The NOC reassurance that it has adequate supply
to last a month should be taken as an estimate for normal times and not when the people
resort to panic buying and, sometimes, hoarding. This clearly means that the government
must enforce some sort of traffic discipline that will result in less consumption of
petrol and diesel by vehicles. It is a generally accepted fact that smooth flowing traffic
gives a better mileage than chaotic traffic. This may also be an opportunity for the
government to reduce air pollution in the Valley by introducing the system of even and odd
number vehicles plying the roads – except in case of emergencies – on alternate
days. This is merely a suggestion that needs to be studied carefully before
implementation.
The panic buying of POL products may not be due
to any fault of NOC, but the government monopoly does face acute financial problems that
must either be rectified or new arrangements be made for the import and distribution of
POL products. The NOC is said to be virtually bankrupt and has no funds to import fresh
supplies of oil. The public sector enterprise is said to have paid out about four million
rupees of accumulated profits. While blaming its overstaffing, which is easy, the fact
remains that the process of importing oil into Nepal might also be faulty. According to
newspaper reports, NOC has to pay a huge amount to Indian Oil Corporation for the delivery
of the finished products. Experts should be brought in to assess whether or not the amount
paid to IOC is justified. In addition, the government must order a thorough study of the
working procedures of NOC, and streamline the organisation in order to make it effective
and competitive. For sooner or later, NOC will have to compete with the private sector,
and unless drastic measures are taken now, it may be too late to save NOC when competition
really starts. |
