Fertilizer gas price hike to hit common man
May 08, 2013
Islamabad (Online): Caretaker Federal Minister for Petroleum & Natural Resources Sohail Wajahat H. Siddiqui in a meeting has proposed to cut the gas subsidy to fertilizer plants which would cause further increase in the fertilizer gas price hike
The exercise is said to be aimed at bringing uniformity in gas prices for all sectors using gas.
The proposal has drawn sharp reaction from leading companies in fertilizer business who are less worried for their profit margins but take it as a serious blow to the fertilizer industry in Pakistan.
In international market of Mid east the fuel price is ( $ 0.75 – 1.75 mmbtu ) where as here it is $ 3.2 for gas and $ 5.4 for fuel. The proposed price hike will increase Rs 800–1000/bag. This will make the fertilizer import attractive than local production. Thousands of related employees will loose jobs and enhance joblessness in Pakistan.
Pakistan Agriculture amounts to 23 per cent of total GDP and employs over 43 per cent of total workforce of Pakistan, anything hurtful the agriculture economy can have significant reverberations on all the sectors which takes feed from the agri – earnings, increase in fertilizer prices can not only reduce GDP but hamper further growth of our already troubled economy.
This will effect farmers, food prices and common man of the country.
The change in price subsidy issue requires thorough deliberations which should emphasize on revamping fertilizer policy by including inputs from all stakeholders including the downtrodden farmers and peasents. The new government may take on this task.
Present off take of industry shows a significant role of international industry. If price of gas is increased this will further enhance increase share of imported fertilizer. Courtesy The Frontier Post