Petroleum prices hiked again !

Citing the price hike in India, Nepal Oil Corporation (NOC) has, finally, hiked the prices of petroleum products. The state oil monopoly hiked petrol price by Rs 3 per litre, and Kerosene and diesel by Rs 2.50 per litre each. But it has not hiked the prices of cooking gas and aviation fuel.
The NOC has revised the prices of petroleum products upwards after it received the new price list from IOC on July 1. "Had the NOC not increased the price, it could have been incurring a loss of Rs 100 million per month, according to the new list," he added.
"With the price hike, price of petrol will be Rs 85 per litre and kerosene and diesel will cost Rs 65.50 per litre each," said Mukunda Dhungel, NOC spokesperson. "After the price hike, NOC will earn Rs 73.9 million in profit."
"The corporation was incurring a loss of Rs 1.16 billion in the current financial year," Dhungel said.
Earlier, the corporation had hiked petrol price to Rs 82 per litre and diesel — the poor man's fuel — and kerosene prices were hiked to Rs 62.50 per litre each. Then also, it had not changed the price of cooking gas. LPG costs Rs 1,250 per cylinder.
On every 1st and 15th of the English calendar month, NOC receives the new rate of diesel, kerosene and petrol from its supplier IOC. The rate of cooking gas is revised on the first of every English month according to the international market price.
According to the increased price in India since June 25, petrol and diesel were cheaper in Nepal by Rs 4.83 and Rs 2.10 per litre. "We had no option to hike to stop the back flow of the petroleum products due to open borders," Dhungel said.
For last one week, there has been a short supply of petroleum products. Though, Dhungel claims that the supply has been normalised, the supply crunch has still been experienced by the people. However, Consumer groups claim that the shortage has been created by NOC to raise the prices of petroleum products after the government turned down its loan request for Rs 1 billion.
But in the last cabinet meeting of the Madhav Kumar Nepal government, it was decided to give Rs 800 million to NOC so that it can pay its dues and supplies in the country could again become normal.
"The deep-rooted corruption in NOC created an artificial scarcity of petroleum products," said Jyoti Baniya, general secretary of the Consumers Rights Protection Forum(CRPF).
"The monopoly of NOC in petroleum products supply is repeatedly making the consumers suffer," a petroleum dealer said adding that the private sector should also be allowed to import petroleum products to create a fair market environment.

Ministry directs not to involve i nnetwork marketing

Ministry of Commerce and Supply (MoCS) has directed not to be involved in any kind of network business as it has formed a committee to study the network business.

Though, the ministry had enforced the directives on January 31 to regulate goods related networking business in Nepal, consumer rights groups have been protesting against the directives as the section 55 of Consumer Right Protection Regulation was silent on the issue.

"That was a malpractice of MoCS which has to be revoked," said Ram Chandra Simkhada, secretary of Consumer Rights Protection Forum (CRPF) that was against the directive since the ministry enforced it.

Government’s negligence in regulating the business has fueled the rapid growth of the business. More than two dozen network marketing companies operating in Nepal are doing business over Rs 28 billion. Money collected by networking companies from poor and low income people was always in risk as the business was unprotected by laws. Over half-dozen network marketing companies had fled in last two decade with Rs 4.6 billions due to weak law. Consumer right activist, Jyoti Baniya, blamed the authorities – the ministry, Nepal Rastra Bank (NRB), Insurance Board (IB) and others related agencies for the rapid growth of business.

"Why did not the authorities take action against networking companies earlier," he questioned. According to Baniya, there are hidden causes including monitory benefit in issuing network marketing directive. "NMD was also the product of mal-intention,” he said.

Meanwhile, the MoCS has formed a five member investigation team under the coordination of joint secretary of the Ministry including representatives from Ministry of Industry, Finance Ministry, Home Ministry and Ministry of Law and Justice. The ministry has banned networking business throughout the country until further notice.

The ministry has strongly warned networking companies to stop their activities.