Raw deal for people at large
THE Awami League-led government on Thursday made another upward revision in the prices of fuel oils, the fifth since its assumption of office in January 2009. According to the government handout, quoted in a report published in New Age on Friday, the increase in prices is aimed at offsetting the estimated Tk 8,500-crore loss to be incurred in the current financial year because of rising oil prices on the international market. It also says the Bangladesh Petroleum Corporation will be counting Tk 11.77 in losses for a litre of diesel and Tk 12.15 for kerosene even after the latest price hike. However, the New Age report points out that the corporation is at break even in marketing furnace oil and actually making profit from selling petrol and octane. The handout also assures that inflation will not cross 7.5 per cent, the limit set for the current fiscal year, although it was 7.22 per cent in October 2012. The apparent discrepancy between the government’s claim and the reality on the ground tends to reinforce the perception that the increase in the prices of fuel oils is actually aimed at meeting the condition set by the International Monetary Fund for the disbursement of the second tranche of its $1 billion loan under the extended credit facility. Moreover, the price hike could be said to have been a given, especially after the finance minister, Abul Maal Abdul Muhith, told journalists after a meeting with an IMF review mission in December that ‘winter is an excellent time for hike in prices of fuel oils.’
Winter may be an ‘excellent time’ for the incumbents to surrender meekly to the whims and wishes of the multilateral lending agency; however, their kow-towing looks set to intensify the misery of the people at large a notch more, for not only this winter but many more seasons to come. There is hardly any reason to feel assured by the government’s claim that it will be able to keep inflation within its fiscal target 7.5 per cent despite the hike in the prices of fuel oils. First of all, increased fuel oil prices are bound to have a ripple effect. If past experiences are any indicator, public transport fare will go up in a day or two, so will prices of commodities, on account of fuel oil prices hike. Secondly, the upward revision comes during the boro season, which means cost of production will go up, given the fact that most irrigation pumps in the rural areas are powered by diesel. Thirdly, and perhaps most importantly, the incumbents do not quite have a flattering record of keeping inflation down; inflation did hit the double digits and stayed there for a reasonably long time not so long ago.
Meanwhile, expensive fuel has not been the only burden to have weighed heavy on the people at large, who have seen the cost of living go up and the real income go down in recent years. The price of electricity has gone up by about 60 per cent since March 2010, thanks to the incumbents’ quick-fix policy of increasing power generation through fuel oil-fired rental plants. In fact, the injudicious policy may have been the reasons that the incumbents had to go for the IMF loan in the first place. Ultimately, the people are once again made to suffer for the flawed policies of the incumbents.
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