|
Govt. in quandary over gas price revision
By Mandana Ismail Abeywickrema
Consumers will be in for a shock if Shell Gas Lanka
Limited is given the greenlight to increase the price of a cylinder
and the government too decides to cut down on the increasing subsidy
once the present agreement with Shell lapses next week.
The increase in gas prices in the global market has
resulted in Shell requesting a price revision from the Consumer
Affairs Authority.
Chairman, Consumer Affairs Authority, M.I.M. Mushin
confirmed that Shell Gas Lanka Limited has requested a price revision.
Discussions in this regard are now underway.
Shell has been partly operating on a government
subsidy, which has been put in place to stabilise the price of a gas
cylinder since February.
The present price of a Shell gas cylinder is Rs. 620,
and the government subsidises Rs. 53.97. If the government on June 19
decides to continue with the subsidy and not resort to a price hike, a
price revision by Shell would mean an increase in the subsidy.
Mushin told The Sunday Leader that the gas subsidy
comes to an end on June 19 and the government would then have to
decide on whether to continue with it or allow a price hike to an
extent to balance the expenditure.
A spokesperson from Shell said that the price revision
requested by the company is in keeping with the increase in global gas
prices.
He further said that Shell conducts price revisions on
a bi-monthly basis.
When asked whether there would be an increase in the
price of a gas cylinder, the spokesperson said that there has been an
increase in global prices.
However, speaking to The Sunday Leader, General
Manager, Shell Gas Lanka Limited, Bob Morian denied that the company
has requested for a price revision.
He explained that the company submits prices to the
Consumer Affairs Authority once every two months.
When asked whether there is a limitation to the amount
that would be increased in each price revision according to the
agreement between the government and Shell Gas Lanka, Mushin said that
the amount to be increased during each price revision is not
specified.
Explaining further, Mushin said that when the company
requests a price revision, the Authority discusses the matter with the
Treasury and decides on the amount to be increased according to market
fluctuations and the dollar rate.
However, this time round, a price revision would have
to be done with caution as the depreciation of the rupee along with
the increase in government expenditure where subsidies are concerned
would have to be addressed.
More
Stories....
|
