New LPG policy proposes big cut in fuel’s price

ISLAMABAD: The Ministry of Petroleum and Natural Resources (MPNR) has a new liquefied petroleum gas (LPG) policy proposing enormous cut by of to Rs 108 per kilogramme besides regulating the price of the commodity. 
In a summary devised for federal cabinet’s Economic Coordination Committee’s (ECC) necessary approval, the Petroleum Ministry has recommended to set price of the commodity at Rs 92.50 per kilogramme for all parts of the country and fixing it at Rs 92,529 per tonne. The ministry believed that in this manner, the price of LPG per kilogramme can witness reduction between Rs 50 to Rs 108 that will result to this domestic cylinder to be available at Rs 1,092 across the country. Setting the margin of LPG distributors and marketing companies the ministry proposed to fix it at Rs 626 per cylinder, while Rs 307 per cylinder for marketing companies and Rs 159 as General Sales Tax (GST) on the sale of LPG.
Official sources disclosed to Daily Times that under the proposed LPG Policy 2014, Oil and Gas Regulatory Authority (OGRA) will issue a price notification, as the price will be regulated, and there will be an imposition of Petroleum Levy (PL) and Gas Infrastructure Development Cess (GIDC) on local LPG producers, while the collected amount under PL and GIDC will be used for providing subsidy on imported LPG so that the price of foreign and local LPG can be sold on same price across the country.
“Since year 2000 the domestic LPG market has been experiencing various challenges including the demand-supply imbalance, cartelisation, litigations and price distortion while forests of the country are facing decay,” said a senior official at the petroleum ministry. 

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