ISLAMABAD: The All Pakistan Compressed Natural Gas Association (APCNGA) on Friday said CNG had become costlier by Rs18 and Rs28 compared to a litre of petrol in Sindh and Punjab, respectively, thereby placing the sector’s viability at stake.

Following the Oil & Gas Regulatory Authority’s notification on Monday, per kg CNG price would jump to almost Rs125 in Punjab and Rs192 in Sindh which will be an unbearable blow to this industry, the association said. This will make the Rs450 billion investments redundant and result in a devastating wave of inflation, it added.

In a statement, APCNGA leader Ghiyas Abdullah Paracha said that contrary to the vision of Prime Minister Imran Khan, the price of CNG has seen an unprecedented hike due to policies of the government and there was no incentive for motorists to use cleaner fuel.

He said it was unfair on part of the relevant authorities not to let the CNG sector to make its own liquefied natural gas (LNG) import arrangements at cheaper rates despite all the laws and regulations in place and then force CNG pump operators to purchase expensive LNG from inefficient public sector monopolies.

Moreover, despite buying the costliest LNG, additional taxes have been slapped on the CNG sector which has made it dearer than petrol for the first time in the history of Pakistan, the statement said.

The price of gas will further increase in October and November if the process of buying costly LNG continued, the statement, quoting Mr Paracha, said. Sales Tax and Customs Duty have been revised upward which will increase the price of the CNG by Rs18 per kg in Punjab and Rs28 per kg in the province of Sindh.

“The high price of CNG will make it unattractive for consumers that will result in the bankruptcy of this industry leaving hundreds of thousands of people jobless. He added that the dollar was gaining strength against local currency which was also contributing to the cost of fuel. Therefore, the government should act swiftly to save this industry from collapse,” the statement added.

The statement said a delegation of the APCNGA met the officials concerned and apprised them of the emerging situation which will result in the closure of CNG stations in Punjab and Sindh. The government is giving a subsidy of billion of rupees to other sectors at the cost of CNG sector which had increased their burden fourfold, Mr Paracha said. He added that the government has reduced petroleum levy on petrol and diesel to zero, Sales Tax had also been reduced on petrol and taxes on liquefied petroleum gas have also been relaxed but taxes on CNG have been increased which was totally unfair.

The APCNGA leader urged the prime minister to immediately intervene and take steps to keep the price of CNG at an affordable level.

Published in Dawn, September 4th, 2021