Petroleum Division proposes 15pc hike in gas tariffs
Bank of Japan lifts growth outlook, keeps easy money policy
The Bank of Japan on Tuesday slightly upgraded its growth forecast for the world's third-biggest economy but kept its super easy monetary policy unchanged.
The central bank said after a two-day policy gathering that it now expects a 0.9-percent expansion in the year to March 2021, an upgrade from a previous projection of 0.7 percent.
The brighter assessment came after a stimulus package launched by Prime Minister Shinzo Abe last year to prop up the economy and dampen the effects of an October hike in consumption tax from eight to 10pc. The decision also followed a fresh trade deal clinched between the US and China, easing a concern that had long worried global investors.
"It is true that the downside risk surrounding the global economy is slightly lower due to... the US-China trade deal and the problem of Britain leaving the EU," BoJ governor Haruhiko Kuroda told reporters. "Investors' risk sentiment has improved and stocks and long-term interest rates have risen in many countries," he said.
World markets have returned to relative calm after the turmoil caused by the killing of top Iranian general Qasem Soleimani by the US.
Petroleum Division has proposed an increase of 300pc in the gas meter rent for domestic consumers and hike of up to 15pc in gas prices for various categories of consumers. In a summary moved to the ECC the Petroleum division has proposed to increase the meter rent for domestic consumers from Rs20 per month to Rs80 per month, official documents reveals.
The price of Rs20 as a meter rent was established in 1997 and the domestic gas consumers used to pay Rs240 annually for meter rent which has now been increase to Rs960 per year. The decision if approved by the ECC will have an impact of Rs34b on the gas consumers. Official source told
The Nation that the summary was on the ECC agenda for Monday meeting, however it was deferred due to the ongoing wheat crises in the country.
In its summary the petroleum division has proposed 5 percent increase in all domestic and other categories except power sector, Zero-rated general industry and their captive power, captive power other than zero rated, CNG, Fertilizer fuel at RLNG price. It was proposed to increase gas tariff for power sector by 12 percent. All zero-rated general industry and their captive power at $6.5 per MMBTU(Rs 1000 MBTU), captive power other than zero rated, CNG 15 percent increase. Fertilizer fuel at RLNG price Rs1672 per MMBTU being current price of LNG. Minimum billing volume for domestic and special commercial consumers (Roti Tandoors) may be revised from 40 cm per month to 50 cm per month for which the bill against gas charges will be Rs 220 per month.
Minimum monthly charges will be determined by OGRA considering consumption of 140 cm per month for bulk domestic, commercial sector, ice factories, and 1000 cm per month for other sector using average GCV of system gas in the country.The prices approved for consumers of SNGPL and SSGCL will also be made applicable for Fertilizer and Power sector consumers to whom gas is supplied directly from fields by
To meet the revenue requirement of the gas distribution companies, in December last OGRA had recommended an increase of up to 214 percent in gas prices for various categories of gas consumers. The authority had determined the revised estimated revenue requirement for fiscal 201920 in respect of SNGPL and SSGCL as Rs 274.2 billion and Rs 282.9 billion respectively. The total proposed burden of the increase of gas prices on the consumers of both the companies were around Rs 567 billion.
Whereas the present sectoral gas sale prices could generate total revenues of Rs227.9 billion and Rs272.9 billion for SNGPL and SSGCL resulting in a projected revenue shortfall of Rs30.8 billion and 2.9 billion respectively. However, instead of Rs567 billion, the petroleum division has revised the gas prices in the manner which will generate a total revenue of Rs 534.1 billion.
The decision which will take effect from January 2020 will help both Karachi-based Sui Southern Gas Company Limited and Lahore-based Sui Northern Gas Pipeline Limited (SNGPL) to collect around Rs34b from gas consumers during next six months (Jan 1st to June 30).