They have, among others, demanded the government to raise their profit margin by almost twofold. [break]The bottlers, who walk away with all the profit, on LPG business have even volleyed the responsibility of consumer safety and awareness to the government and demanded it to set up a fund for running awareness campaigns.
“The government´s decision to enforce dual pricing by compelling us to circulate differently colored cylinders will only increase anomalies, leakages and scarcity of gas. It will also subject us to a huge cost,” Shiva Prasad Ghimire, coordinator of a committee of Nepal LPG Industries´ Association, said on Monday, urging the government to instantly revoke the decision.
The association unveiled its 16-point demand on the day and declared that it has given the government an ultimatum of a week to fulfill them. “If not, we will stall placing LPG order from August 7, stop receiving gas from all Indian Oil Corporation (IOC) refineries from August 8 and halt imports from August 9,” said Ghimire.
“If the government still did not fulfill our demand, we will shut down all LPG refilling plants, brining distribution of gas to a grinding halt from August 15.”
Under its loss cutting measure, the Ministry of Commerce and Supplies (MoCS) had announced that it would introduce dual LPG cylinders -- red colored cylinders for general consumers and blue colored ones for commercial consumers like hotels, restaurants, factories and automobiles, among others -- from August 17.
While it committed to continue supplying gas to general consumers at the existing subsidized rate, it has planned to make commercial consumers pay price equal to actual import rate for the supply. Through the move, the ministry plans to slash Nepal Oil Corporation´s (NOC´s) loss from LPG business by half from existing Rs 431.6 million a month.
Going by the plan, NOC had recently instructed LPG bottlers to paint the cylinders and segregate them for general and commercial supplies.
But bottlers have vehemently protested the decision. “There are around 4.5 million cylinders in circulation and we cannot color them separately at one go. Besides, it will also require us to invest at least Rs 560 million,” said Hari Pathak, president of the association.
The association has also urged the government to raise industries´ commission to at least 5 percent of the retail rates. So far, they were allowed to take profit worth 3 percent of the retail rates.
That is not all. The bottlers have also asked the government to set aside a fund equivalent to one percent of the total import cost (which at present value stands at around Rs 900 million) to raise public awareness and promote consumer safety.
It has also demanded that the NOC provide third party insurance for LPG transporters, among others. The association has also asked the government to formulate a separate law to govern LPG business.
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