KARACHI, Nov 26: In what appeared to be an attempt to put pressure on the government to increase the per kilo price of the compressed natural gas, CNG associations across the country went on an unannounced strike on Monday and shut down CNG stations on different pretexts for an indefinite period causing severe hardship to commuters and motorists.
A large number of people in Karachi faced serious problems in going to their offices, schools, etc, and returning home, as most public transport, which had been converted to CNG, remained off the road due to unavailability of fuel.
While most CNG stations complained about a low gas pressure as the reason behind the closure, sources maintained that they were actually on strike due to the slashing of per kilo price by the Oil and Gas Regulatory Authority (Ogra) on the directions of the Supreme Court last month.
The chief of the All Pakistan Petroleum and CNG Dealers Association, Abdul Sami Khan, told Dawn that the CNG station owners closed their outlets because the apex court had allowed them to do so if they felt that they were operating at a loss. “Ogra, too, has said that it will not take any action regarding the matter of unannounced closures so there you have it.”
Meanwhile, the chairman of the Sindh CNG Association, Zulfiqar Ahmed Yousufani, said that he was hopeful that Orga would reconsider the CNG price fixation while also reducing the taxation.
“We attended a three-hour-long meeting with Orga in Islamabad on Monday, where we discussed with them our problems. I am hopeful of some good coming out of the meeting,” he told Dawn.
“Though the stations all over the country have decided to close on their own, they only did that after we failed to do something for them during the past month. They have gone into considerable losses. Many have also had to do away with most of their staff. The slashing of the price is just not feasible for the business although some company-owned and army-owned CNG stations are still operating,” he provided.
The chairman of the CNG associations’ supreme body, All Pakistan CNG Association (APCNGA), Ghiyas Abdullah Paracha, was also of the view that the owners of the CNG stations have closed their outlets as a last resort, as they were unable to pocket more losses.
“The CNG business is no more viable as recent developments have left owners of filling stations with no option but to take loans to pay their utility bills and employee salaries,” he said, adding: “We don’t want to burden the masses therefore the government should introduce uniform rates of gas and uniform taxation to provide relief to them. CNG consumers should not be made to share burden of other influential sectors”.
Mr Paracha said that Ogra in Monday’s negotiations had accepted that the CNG sector is overtaxed and assured that they will raise the issue with the ministry of petroleum and natural resources to decide the CNG prices after Nov 28.
He said that a pricing formula having three options, which has been backed by all the CNG associations, had been handed over to Ogra and now it was up to the government to accept any of the option to keep prices of economical fuel in range of the inflation-stricken masses.
Giving more details, Mr Paracha said: “We have proposed prices of gas and taxation according to that imposed on the fertiliser, industrial and power sectors. In the first option the prices of CNG will become Rs42.26 and Rs44.99 in region one and two, respectively. The second option will bring the retail price of the CNG to Rs68.80 in region one and Rs65.63 in the region two.
And if the third option is accepted, the prices will be Rs72.04 in region one and Rs68.59 in region two.”
He maintained that the only way to make prices rational while ensuring relief to the masses was reduction in gas cess and gas surcharge. “The government has shifted the entire burden on CNG stations without reducing taxes which has resulted in confusion and problems,” he said, adding that “such decisions will result in a rift between the CNG station owners and the masses.”
Finally, he stressed that the APCNGA had not asked anyone to close their businesses.
Meanwhile, Ogra chairman Saeed Ahmad Khan called a public hearing in Karachi on Nov 28 to settle the new CNG prices.