Stop manipulators of the LPG market
What's the point of fixing the prices of imported liquified petroleum gas (LPG) if those are inflated at will before it reaches consumers? What's the point of a regulator if it has little to no control over the implementation of its regulation? These questions come to mind when you think how LPG is currently being sold at up to Tk 300 or 20 percent more than the official rate. Earlier this month, the Bangladesh Energy Regulatory Commission (BERC) fixed the price of the 12-kg LPG cylinder – the most common form of marketed cooking fuels – at Tk 1,498 for February. It marked an increase of Tk 266 from the previous price, in a blow to ordinary people already overwhelmed by the high cost of living. But a bigger blow still was when even that increased price was further inflated.
At a recent meeting, the LPG market was rightly described as "chaotic" by the director general of the Directorate of National Consumer Rights Protection. As revealed by market sources, importers, dealers and retailers were all involved in inflating the price illegally. For example, importers were selling a 12-kg cylinder at around Tk 1,520-1,532 to dealers/distributors, who were selling it at around Tk 1,550-1,600 to retailers, who in turn were selling it at Tk 1,700-Tk 1,800 to general customers. The rates of inflation vary, of course. If you ask the importers, dealers and retailers, each will blame the previous player in the chain. Each have their unique reasons, which they were not shy of sharing at the BERC meeting.
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This is not the first time that officially set prices – not just of LPG but many other consumer products – have been overlooked with such reckless abandon. Over the years, there have been numerous occasions when poor regulation and oversight allowed illegal practices such as hoarding and artificially inflating prices to take place. Despite extensive coverage of price fluctuations/manipulations in the market, lack of preventive steps and alleged complicity of state officials make it easy for the unscrupulous traders to get away without punishment. The question is, what about the ordinary people? Who will protect their interests?
In the LPG market, it is supposed to be the BERC, which not only sets prices but is also responsible for ensuring compliance of its decisions, which it is evidently failing to do. As it stands, the BERC has set a rate that neither the consumers nor those on the supply side are happy about, each for different reasons. The BERC secretary has promised to hold a public hearing within 15 days to a month if all the companies send documents supporting their demand for a more favourable pricing formula/structure. If that means revising the LPG price further upwards, consumers have every reason to worry about.
We urge the BERC and other relevant departments and ministries to think of the consumers as well. They must ensure compliance of the officially set prices of products and fuels through proper market oversight, and must punish those who are violating them arbitrarily. Citizens' interests must be put at the centre of policymaking.
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