Distribution of imported composite fiber gas cylinder faces problem

Published On: August 14, 2017 10:05 AM NPT By: Ritesh Tripathi

BIRGUNJ, Aug 13: The composite fiber LPG cylinders, imported in Nepal after a delay of four years since the government issued a related policy, is now facing problems of distribution. 

In 2012, the government in its annual budget had announced to import and distribute these cylinders because of their lighter weight and safer features.
Composite LPG cylinder is a better alternative to the currently used iron cylinder that is considered riskier. 

Despite the government policy to promote it, there have been procedural hurdles to the sale and distribution of composite LPG cylinders.

The government has even eased customs duty on composite cylinder for its promotion. According to clause 15 (3.b) of Finance Act 2010/11, only 15 percent customs will be levied on composite LPG cylinders imported on recommendation of Nepal Bureau of Standards and Metrology (NBSM). 

The composite cylinder would be levied fewer taxes than the iron cylinder and on top of that, the government had initially offered subsidy for its import. However, not a single composite cylinder was imported when there was government subsidy.

The government lifted the subsidy in Fiscal Year 2016/17. "We couldn't provide subsidy for the import of cylinders in the lack of legal provision for that," chief custom officer of Birgunj Customs Office Sebantak Pokharel said: "The subsidy was in place until last year."

The distributers and importers of LPG cylinders say that there are two major hurdles to start the use of composite cylinders. First, the price is higher for consumers as its custom rate is higher than the iron cylinders after the scrapping of subsidy. Second, gas bottlers have not brought it under the distribution system.

"The cylinders are out of consumer's reach as it is more expensive and even if they want it, we cannot provide them the cylinders," Ganesh Shrestha, a LPG distributor said. "Its distribution will be possible only if bottlers fill up the gas in the cylinders." 

The importers have fixed the price of a composite cylinder at Rs 10,500. If the customs subsidy were introduced, the price of one cylinder would be decreased by Rs 2,373.
Kishorilal Tibadewal, management director of Karmam Bhagyam Company, one of the importers, said if they were to get customs subsidy, they could be able to supply composite cylinders for a price between Rs 8,000 and 8,500.

Composite cylinder is lighter in weight. It weighs only 7 kilograms, whereas the iron cylinder weighs 14 kilograms. After filling, the former weighs 22 kilograms and the latter, 30 kilograms. 

Manufacturers and importers claim that the composite cylinder is safer to use as it never explodes.

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