Bangladesh News

The government plans to hike the prices of CNG by the end of this month and diesel and electricity after the Boro season to overcome the deficit in national economy.

Prof Dr M Tamim, special assistant to the chief adviser and in-charge of the Ministry of Power, Energy and Mineral Resources, said this yesterday.

“The government considers withdrawal of subsidy from the energy sector including CNG, diesel and electricity, which are mainly used in business purpose such as transport and industries,” Dr Tamim said.

He was speaking at the ‘Meet the Reporters’ programme arranged by Forum for Energy Reporters of Bangladesh (FERB) at the National Press Club.

“In a national budget of Tk 87,000 crore, we have to spend Tk 14,000 crore to subsidise the energy and fertiliser sector, which creates a huge deficit in national economy, specially in food and education sector,” he added.

He also said the subsidy fixed for rural farmers would not be withdrawn at this moment, adding that the farmers use only 20 percent of total energy including diesel and electricity.

Dr Tamim put emphasis on quick policy formulation for proper distribution of energy resources. The government is already considering reserving gas for industrial sector and CNG and coal for electricity production for domestic use, he noted.

He went on to say that this year the government would be able to produce 4,000-megawatt electricity, whereas the demand is around 5,000MW. To meet the demand additional demand, the government still has no specific solutions, meaning huge load-shedding across the country.

He also said the government would be able to produce 2,000MW more in association with some foreign companies by the end of 2011.

Dr Tamim said the government has already involved national oil and gas exploration company Bapex to drill new gas fields to overcome the gas shortage.

This includes developing Semutang, Begumganj and Shahbazpur gas fields and drilling exploratory wells in Kapatia, Srikail and Sundalpur gas structures.

The government also considers supplying coal for gas-based power plants and formulating a coal policy in near future, he added.