Fuel price hike will have severe impact on poor: CPD

PBC News:  Terming the recent diesel and kerosene price hike by the government as “irrational,” Centre for Policy Dialogue (CPD), a local think-tank has called for shifting fuel prices to previous rates immediately.

It says that the decision to diesel and kerosene price hike is not logical from economic point of view. “The decision to price hike of fuel oils is contrary to the government’s policy, morally unacceptable, and not politically enlightened.”

The CPD made the above observations during a media briefing on “How much necessity it was to raise the fuel oil price?” held on Wednesday in the capital.

CPD executive director Dr Fahmida Khatun, honorary fellow Dr Mustafizur Rahman and research director Khondker Golam Moazzem were present at the media briefing.

Speaking at the media briefing, Dr Mustafizur Rahman said the decision to fuel price hike is illogical to the economic point of view. It is contrary to the government’s policy. The decision is also morally unacceptable, and not politically pragmatic.

Dr Fahmida Khatun presented the keynote paper at the briefing.

According to the CPD executive director, there will be immense pressure on overall economy and living standard of people because of the price hike of fuel oils.

“This price hike may have a very little impact on affluent section of the society. But, those who are poor, become poor anew, and are trying to get recovered staying in a Covid-infected economy, they will face severe impact of the fuel oil price hike. If we tell about justice, it (fuel price hike) is also an unjust step [by the government],” she said.

Dr Fahmida Khatun mentioned that the government hiked the fuel oil prices to reduce the losses of the state-owned Bangladesh Petroleum Corporation (BPC). But, why the BPC has been incurring losses over the years? “We know there is a lack of good governance in the BPC. There are numerous allegations against mismanagement in purchasing, selling and marketing fuel oils by the BPC. They market their fuel oils through different companies. We also find allegations of corruption there.”

She opined that the losses of the BPC could be adjusted from the accumulated profits that it had gained in the last seven years.

Besides, the deficit could be adjusted by reducing taxes on fuel sales which are around Tk 9,000 crore annually, she added.

The government hiked diesel and kerosene prices by Tk 15 to Tk 80 per litre on November 3, in the wake of crude oil price hike in global market. Following the hike of fuel oil prices, the government also raised the fares of public transports, trucks and launches.