Political pressure forces govt to put on hold gas tariff hike.

ISLAMABAD -- Owing to political pressure on the rising wheat and sugar prices, the government on Monday withheld an announcement to increase natural gas tariff by 5-15 per cent to avoid public criticism.

According to informed sources, a second session of the Economic Coordination Committee (ECC) of the cabinet was called in the evening to consider a summary by the energy ministry to increase gas prices.

Adviser to the Prime Minister on Finance Dr Abdul Hafeez Shaikh presided over two meetings of the ECC in the morning and evening.

The officials concerned of the energy ministry (petroleum division) and the Oil and Gas Regulatory Authority (Ogra) were on standby at their offices to process the notification about gas price hike.

They were, however, relieved at about 8pm with the message that the ECC had deferred the decision owing to the increasing pressure on wheat and sugar prices.

ECC defers decision to avoid public criticism over rising wheat, sugar prices

The sources said Ogra would be issued a letter by the petroleum/cabinet division to put on hold the gas price hike notification for a few days to release the public pressure given the fact that the law required automatic notification of gas price adjustment in case of government's failure to respond to the Ogra-determined rates within 40 days.

The summary seen by Dawn suggests the petroleum division had reported to the ECC that under the Ogra law, the federal government was required to 'advise category-wise gas sale prices to Ogra for notification in the official gazette within forty days i.e. 20th January 2020'.

Under the summary, the petroleum division had changed the recommendations of Ogra by reducing the proposed price increases for the poor and lower middle class. The summary, however, proposed about 400pc increase in meter rent for domestic consumers from Rs20 per month to Rs80. The petroleum division said the meter rent was last fixed in 1997.

The summary proposed a 5pc increase in gas tariff for domestic consumers with lower consumption, 12pc increase for power sector plants and 15pc increase for industrial captive power plants and compressed natural gas (CNG) stations.

The petroleum division said Ogra had on Dec 11, 2019 determined the revenue requirement of Rs274.2bn for Sui Northern Gas Pipelines Limited (SNGPL) and Rs282.9bn for...