Increasing gas prices damaging economy, says PEW

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ISLAMABAD: The Pakistan Economy Watch (PEW) on Sunday said faster than expected rise in the prices of locally-produced and imported gas is damaging the economy.

The price of local gas has been revised frequently while taxes have been slapped on import of Liquefied Natural Gas (LNG) which has reduced demand for the clean fuel, it said.

Reduced demand and continued supply has increased pressure which can result in pipeline bursts and damages to the processing units, said President PEW Dr Murtaza Mughal.

He said that power plants and industrial sector has reduced production resulting in loss of production, unemployment and increased load-shedding.

Dr Murtaza Mughal said that LNG import contracts have been signed and imported LNG is coming into the country according to the schedule but buyers have reduced purchases creating problems for various departments.

“Rescheduling imports will be a costly option as $210 million are payable to LNG suppliers by August 5,” he said, adding that the local buyers of LNG have not paid the due amount of Rs80 billion.

He said that the government should reconsider the construction of more LNG terminals unless the situation improves.

The PEW president said that the electricity tariff has been increased many times but the consumers continue to suffer scheduled and unscheduled load-shedding while circular debt continues to increase.

The government continues to pay 18 per cent interest on loans obtained to tackle the chronic circular debt, he said.

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