Fuming over CNG

Three years in a row the calendar year ended with a strike in Karachi for one reason or another. 2011 ended with a transporters strike protesting on what they term as an unjustified increase in CNG prices. The 22 percent and 29 percent increase in CNG prices across two regions has been rejected by the CNG and transport associations alike, calling it a burden on the masses. That the transporters continue to charge commuters on diesel rates despite having converted nearly two-third of the system on CNG is an entirely different debate altogether. It was all set to be even worse for the CNG players, until a last minute amendment to the infrastructure cess on CNG was reduced to 50 percent of what was earlier decided, in principle. Public pressure is what is perceived to have led to this revision in infrastructure cess, however, the strength of the CNG and transport lobbies leading to this decision cannot be undermined. There is no denying that the CNG sector cannot be asked to wrap up regardless of being a result of poor planning in the previous years. But, it has to be understood that the usage of natural gas for fuelling the transport sector is not the most efficient use of the precious and scarce natural resource. It is not that the commuters are deprived of CNG through the year either, it is just the peak winter season where the demand pressure affects supply and thus the load management. All users of natural gas form fertiliser to general industries, and from power to domestic sector are affected by load management in winters-which is the only way out until the country taps potential reserves. It may be argued that imposition of infrastructure cess may not be the best method to increase prices, as the future of IP and Tapi gas pipelines (the purpose for which the cess has been implemented) remains dicey. What the people need to understand is that there are sectors that need natural gas more than the transport sector. Fertiliser industry cannot run without natural gas, as it happens to be the raw material for urea production. The same cannot be claimed by the textile industry, which has an alternative fuel available in furnace oil, and fuel cost for them does not constitute more than 8-9 percent of their primary production cost. The government also needs to act more serene and explain the public: why CNG usage is not optimal for the people. The gas consumed by transport sector could be used in power generation which in other case is generated through much expensive furnace oil, inflating the tariffs and affecting the masses at an even larger scale. Similarly, the production loss by the fertiliser firms also results in massive hike in fertiliser prices, which trickle down to common mans staple food prices. The government must educate the masses, politicians and the media on why CNG is not the ideal use of natural gas. The people must also be let known that CNG even at the current increased rate is much cheaper than petrol and diesel and the difference should be calculated based on heating values and not the apple to orange comparison of kilogram to litre, which the transporters currently use. Last but not the least, since packing up of CNG sector is not an option, its use should be limited to public transport only and transporters should be compelled to charge fares accordingly. Unfortunately, the government seems to be going in the exact reverse direction, banning the use of CNG in public transport. One wonders who needs the subsidy more, owners of motor cars or commuters using public transport!