The instruction was issued by Krishna Hari Banskota, secretary of the Office of the Prime Minister and Council of Ministers, to high-ranking officials of the Ministry of Commerce and Supplies, the Department of Commerce, and Nepal Oil Corporation on Wednesday.[break]
“Circulation of cooking gas in blue and red cylinders should start from mid-June,” Banskota said. “Gas bottling companies that fail to start issuing cards to customers for distribution of cooking gas in two different colors of cylinders within a month will not be extended product delivery order.”
Although the government has long been floating the idea of introducing different colored cylinders for domestic and commercial purpose to ensure subsidy extended on liquefied petroleum gas (LPG) does not go to entities using the fuel for business purpose, it has not been able to enforce the decision due to protests launched by bottlers as well as students.
Currently, the government is extending subsidy of Rs 439.50 on every LPG cylinder (14.2 kg) currently priced at Rs 1,470. To end this practice, the government on February 12 raised the price of cooking gas by Rs 630 to Rs 2,100 per cylinder and offered to extend a rebate of Rs 630 to those using the fuel for household purpose.
But it was forced to roll back the decision after student unions launched protests, bringing movement of vehicle to a grinding halt in various parts of Kathmandu Valley.
One of the reasons why the decision to introduce dual pricing in cooking gas met with protests was the cumbersome process of reimbursing customers using the fuel for household purpose.
At that time, the government had said households should pay Rs 2,100 upfront and collect rebates from any branch of Bank of Kathmandu, which, according to many, was lengthy and unpractical.
“We have now scrapped that provision. From June 15, cooking gas for household purpose will be made available at subsidized rate from any retail store while those using the fuel for commercial price will have to pay the price fixed by NOC,” Banskota said. “But those eligible for subsidized cooking gas will not be able to purchase the fuel at a lower price unless they produce a card issued by NOC.”
As of now, there are 958,671 cooking gas users in the country, of which 502,371 reside in Kathmandu Valley. However, of these users, only 318,994 have forwarded their applications to NOC for verification.
Currently, 1.3 million cooking gas cylinders have been circulated in the market. Of these, 60 percent are likely to bear red color once the dual pricing system is enforced.
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