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—File Photo.
—File Photo.

ISLAMABAD: The government has decided in principle to raise the price of compressed natural gas (CNG) by over 80 per cent to reduce its cost differential with competing fuel — petrol — and to discourage consumption of natural gas in the transport sector.

A senior government official told Dawn that the recommendation for the tariff hike had been made by the energy sector task force appointed by Prime Minister Nawaz Sharif under his national energy policy to divert scarce natural resource to power generation.

Under the decision, the CNG price will be raised from 49 per cent parity with petrol to 90pc. All relevant ministries and the prime minister have supported the move that will be presented to the Council of Common Interests (CCI) for approval.

As a result, the average sale price of CNG will go up from Rs73 per kg to about Rs133 per kg, based on current petrol price of about Rs100 per litre.

The PPP government had increased the CNG rate last year to reduce price differential with petrol as a policy tool to discourage gas consumption in the transport sector, but the price was reduced on the intervention of the Supreme Court.

The official said the PPP government had to reduce the CNG rate because the decision had been taken by the ministry of petroleum on its own, but the PML-N government would adopt a legal course by getting it approved by the CCI.

Comments (16) Closed

Razi Jun 27, 2013 08:43am

If so then elections in Oct-2013. Pl Mr PM do not do this in haste talk to Engineers, MBAs and strategists not accountants, please

murad Jun 27, 2013 08:45am

A very corrupt govt.havnt any policy or plan to let country out of this disaster

JUNAID KHAN Jun 27, 2013 09:40am

This is Great. Its a good initiative by Nawaz Government. Now if they are sincere with the Nation, the same prices i.e. Rs.133/Kg shall be liable on Lahore Transport Company as well.

Faisal Jun 27, 2013 10:16am

About time. Maybe this will enable the government to divert more gas to the power sector and reduce overall electricity shortfall.

Once (and if) the gas from Iran is purchased we can look into reducing the CNG prices.

However the only long term solution is to focus more on exploration of new on/off shore gas reserves, encourage alternate sources of energy and fully realize the potential of already discovered minerals (aka Thar Coal).

Gulzar Jun 27, 2013 10:36am

Je Hence proved "Democracy is the best revenge" "In Pakistan"

AJ Jun 27, 2013 10:56am

looks like govt wants to pack up as there would be so many protests that they have to leave again for saudia an hopefully this time permanently. You can't ct poor man's throat all the time. People have invest billions of rupees in cng sector, who will pay for their losses. India heavily subsidizes Diesel to improve their economy whereas these smart politicians in Pakistan ar taking steps in other direction.

@H__3 Jun 27, 2013 01:06pm

Wise decision. We cannot run both cars and stoves on gas with the limited reserves that we have..

shahbaz Jun 27, 2013 01:13pm

Or because Nawaz Sharif is best buddies with the Chief Justice. Anyone else thinking this? Where did all the Suo Motos go.

Blitzer Jun 27, 2013 02:49pm

These measures would deal a death blow to the multi-billion dollar investment made by consumers on CNG conversion kits installed in their vehicles along with destroying the business of CNG stations.

Undoubtedly, Natural Gas is a scarce resource in Pakistan and burning it away in IC engines or even producing electricity from it should be strictly curtailed. Instead most of the NG supply should be redirected to industries such as those in the fertilizer and textile sector. Penalizing the general public for converting their vehicles to CNG at such a later stage is extremely counter-productive. If the Sharif-led GoP is serious in resolving the perpetual lack of NG in the country they should invest in the IP-pipeline on a priority basis, followed by the TAPI gas pipeline. The indifference of the current regime to the prior project can be gauged from the fact that they have not allocated anything for the IP-pipeline in the most recent federal budget, under mounting pressure from Saudi Arabia and the USA.

Fahad Ali Jun 27, 2013 04:14pm

This is height of corruption. I think gov should think about these notices.

Sajid Jun 28, 2013 12:20am

They are usinng ppp will hit poor people badly....i m nt feeling any defference b/w pmln nd ppp strategy abt energy.....nd its not possible to raise the prise....poor people use it will hit poor people....whch iz not good...

Zuhair Jun 28, 2013 02:25am

How is 90% parity equal to 32 rupees more than the price of petrol?

yawar Jun 28, 2013 01:09pm

@JUNAID KHAN: Will be lot of fun when a passage asks a cab for a nearby ride and he would say 600 for sadder from airport (Islamabad )..bcz there is no gas and cabs are on petrol or diesel (what would be worth of 500 rs merely 5liter petrol... dear if this starts to happen then people would prefer to travelling on bicycles rather than public transports...public transport fares would also increase many times and you think that would be a good decision.. Why to burn gas in generators, Why to burn it in tandooorss? Why not divert their gas as well to other sector?

Indian Jun 28, 2013 02:00pm

I think this is a good decision by Govt, it may seem harsh but is actually good for the people.

Sher A Jun 28, 2013 02:53pm

This move will result a flood of price hike of the basic essentials / commodities.

Omair Ahmed Jun 29, 2013 01:06am

This move is going to generate millions which can be spend on politician personal expenditure. Excellent move Mr. Prime minister, I always though that the day would come when poor would get justices by having atleast necessities. But i think either Pakistan wont remain or resurrection day shall come before that happens. I have completely lost hope ..Is mulk ka kabhi kuch nahi hoga..Mark these words!