A faulty recipe
Oil and Gas Regulatory Authority (OGRA) has moved a summary recommending therein an increase Rs.7-9 in the prices of petroleum products. The approval of second dose increase, even lower than the proposed one, will have across-the-board multiplier effect on the rates of wide range of commodities and services. The transportation fare will go up, electricity tariff will be increased abnormally and prices of food commodities will certainly touch the sky.
Manufacturing sector will also get another death blow in the shape of spike in production cost and loss of competitiveness of its products in the home and international markets. Trade bodies are persistently demanding lowering of electricity tariff. The fall in exports will cause another round of depreciation of national currency, taxing the power consumers, snow-balling the circular debt and making further rich the owners of IPPs. Former President of this cartel, who holds the charge of Petroleum Advisor in the present government, either by design or default, did nothing for expanding the onshore storages for petroleum products. Had he honestly and efficiently discharged his responsibilities, forward contracts would have been made for the import of reasonable quantities of crude oil and petroleum products on hedged price when global oil market had crashed. The neglect of expansion of onshore oil storages also impacted its import from Saudi Arabia under deferred payment facility. Will responsibility be fixed for this damage?