Unreasonable LPG price cannot be tolerated: DNCRP director-general

The Directorate of National Consumer Rights Protection (DNCRP) will not tolerate the practice of LPG sellers unreasonably charging around Tk250 more than the price set by the government for a cylinder, said the organisation's director-general.

"Drives will be conducted if prices are increased illegally. If we get complaints from buyers or intelligence agencies give such information, then such drives will definitely continue, but it will always be logical. This sector will never be left unprotected," said DNCRP Director-General AHM Shafiquzzaman at a meeting of gas cylinder producers, distributors, and businesspersons, organised by the DNCRP Tuesday.

The price of a 12 kg LPG gas cylinder was increased from Tk1,219 to Tk1,235 this month.

At the meeting, LPG producers complained that the Bangladesh Energy Regulatory Commission has been setting gas prices without taking into account the increase in LPG prices in the global market, dollar price, import cost and transport cost. Consequently, the price set by them is not commensurate with the true price of the product.

Responding to the allegation of LPG sellers, AHM Shafiquzzaman said, "Despite all complaints, when the government sets the price, it has to be obeyed. If the consumer does not get it at the fixed price, it will be cheating. You should explain the problems to authorities before fixing the price. It is unbelievable that you cannot do that."

"Earlier there was not much problem in this sector. Now the problem arises as the demand for LPG is increasing. That is why the BERC has a role to play in this matter," said the DNCRP director-general.

He also said, "I will sit with the BERC chairman. He was the one who told me about conducting drives to control prices. We can discuss and develop solutions for the problems."

When the traders said they have been incurring losses even after charging higher prices, Shafiquzzaman said, "I have never heard of any businessman making a profit. You always say that you are making losses, but despite that we see that your businesses grow."

At that time, M Muntasir Alam, chief commercial officer of Beximco IOC Petroleum and Energy Ltd, said, "We had to make repeated requests to get a place in the BERC meeting on determining price. We were not interested in pricing last month, because the LC settlement rate was fixed at Tk102 without talking to us. The dollar price was much higher at that time."

"Besides, the rate of storing and bottling gas was determined at Tk186, but we have calculated this cost to be Tk245, which was not accepted. Moreover, despite the fuel price hike, the internal transport cost is set assuming a fuel price of Tk65 per litre. The transport operator's profit margin was not considered to set the price. As a result, the set price was not reasonable," he added.

Md Abdur Razzaq, managing director of JMI Group, said, "Investment in the LPG sector is Tk32,000 crore. I have also invested heavily in this sector, which was a big mistake. We cannot hike prices like the government raised the fuel price by Tk48 overnight."

Some of the dealers and sellers participating in the meeting said they have not been making any profits as LPG producing companies are reducing their profits. A number of companies had their profits cut three times in one month.

They also said while operators are responsible for increasing prices, different government agencies fine dealers and retailers.

At the meeting, BERC Deputy Director Firoz Zaman said he will convey the concerns of LPG producers, dealers and sellers, to the BERC chairman.