Alberto Barbieri Managing Director, Landirenzo for Middle East region said the cylinders explosions have cast grotesque shadows over the restriction imposed by the government on CNG kits as no single cylinder blast has so far been reported after the decision.
"It is quiet strange that all cylinders were exploded between September 2011 to December 2011 period and no more cylinder blast was witnessed after the restriction imposed by the government on the installation of CNG kits," he said while talking to media at a press conference held at local hotel on Wednesday.
"I am asking a question; why no such blast was reported since December 2011, if the installation of CNG cylinder was declared perilous; what we believe that it might have been a pre-planned campaign against CNG sector," he said. He dispelled the impression to end up business activity from Pakistan, saying that "the Landirenzo, which has so far invested Rs 2 billion in the country, is not planning to shut all commercial activities".
"Although the Landirenzo is capable to provide LPG system in Pakistan, we are reluctant to pour more investments, due to inconsistent government policies," he maintained. Replying to a question, Alberto said, "If the ban on CNG kits was lifted and the authorities had assured not to take such harsh decisions in future, the Landirenzo could offer more investments especially in LPG sector."
Meanwhile, Arshad Altaf, CEO of BRC (Gas Equipment) and Hasan Askari, BRC OEM agent said it was illogical on the part of government to cut the gas supply to transport sector which was consuming only 9.1 percent of the total gas before the ban and the figure would be much lesser now owing to the gas stations closure of 1-3 days in different parts of country.
"The ban appears even stranger with the fact that the government itself is a major beneficiary in terms of revenue of Rs 240 million per annum it gets from the sector, while the usage of CNG instead of petrol and diesel translates in the savings of Rs 222 billion in account of petroleum import bill," they said.
The government is also losing a plausible revenue share from CNG kit manufacturing companies that were exporting around 60,000 kits to Afghanistan, Italy, Thailand, China, Brazil, Iran, and Bangladesh. By dint of imposing ban on CNG kits, the government is losing $6 million foreign exchange a year what it gets from the exports of CNG kits to the said countries, they added.
They said that the ban on CNG is total discrimination against CNG industry which consumes even less than the gas line losses of 10 percent and instead of taking concrete steps to cut the line losses, the government is cutting the supply to CNG and other industries. They were of the view that the government policy shift has also created differences among different sectors and industries in the country, which is also negative for the growth of local industries.
They said that the government's gas load management plan was made to supply more gas to the industries, however despite imposition of ban on CNG conversion and 24 hours weekly closure of CNG stations, the industry is still getting the same volume of gas. They said shifting from CNG to LPG would be a long-term process requiring new investments, and as per estimates the cost of importing LPG to cater to a large number of vehicles will be over $6 billion a year.