Multan Chamber of Commerce and Industry (MCCI) President Khwaja Muhammad Jalaluddin Roomi has strongly reacted to the increase of gas prices by 7.67 percent (Rs 20.56 per million British thermal unit) by Sui Northern Gas Pipeline (SNGP) and the Sui Southern Gas Company (SSGC) by 7.83 per cent (Rs 18.35 per mmbtu).
The MCCI President said in a press statement here on Saturday, the hike in gas tariff was yet another blow to the industry after the imposition of 35 percent letter of credit (LC) cash margin on import of raw material. He said that the requirement of 35 percent LC margin on import, which was imposed in May this year, was against the national interests and detrimental to the industry as a whole.
Roomi said that the cost of production of exportable items was increasing with each passing day, badly hitting our exports. "As a result, we will not be able to compete with India, China, Thailand, Indonesia, Bangladesh, Sri-Lanka and other countries," he said.
He said that the Oil and Gas Regulatory Authority (Ogra) did not entertain the objections raised by the chambers and consumers and unilaterally allowed the SNGPL and SSGC to raise gas prices by 7.67 per cent and 7.83 per cent, respectively.
He said that such steps were detrimental to the industry because the oil and gas regulators gave both the utilities a go-ahead to raise their prescribed tariff to ensure smooth running of their day-to-day businesses and provision of services to the end-consumers.
As a result of the decision, the SNGPL would jack up its prescribed prices by 7.67 percent (Rs 20.56 per mmbtu) and the SSGC by 7.83 per cent (Rs 18.35 per mmbtu) with effect from January 1, 2009.
However, the government was bound to pass the impact of the increase on to various categories of gas consumers to generate revenue determined by the Ogra from January 1. By the same token, the Federal government was required to direct the Ogra to revise the prescribed price, the minimum charges and the sale rate for each category of retail consumers for notification in the official gazette within 40 days, he said.
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