Kathmandu, May 30:

Entrepreneurs here today asked the government to take immediate measures to ensure smooth supply of petroleum products, which are in acute shortage for last several months.

They suggested the government to either adjust prices or inject enough cash or cut taxes being imposed on imports of fuel as an immediate measure to cope up with the crisis.

“The short supply of petroleum products has hit the business activities, transportation, industries, tourism and agriculture sector hard as these are the main pillars of the Nepali economy,” they said.

They were speaking at an interaction organised jointly by the Federation of Nepalese Chambers of Commerce and Industry (FNCCI) and Nepal Petroleum Dealers’ Association (NPDA) in the valley today.

Shiva Prasad Ghimire, president of NPDA, lambasted the government for its lackadaisical attitude towards ensuring adequate and smooth supply of petroleum products. He accused Nepal Oil Corporation (NOC) for being an useless entity.

“The prolong fuel crisis would lead to an accident in the national economy and loss may not be recoverable,” Ghimire warned, adding that an immediate measure must be taken to make supply smooth for the time being. He also suggested that adjusting prices and cutting import taxes could be immediate solutions to increase supply.

In the long run, he said NOC must be privatised by divesting 51 per shares of the corporation to private sector, NOC employees and transport entrepreneurs. “The management and operation part for fuel supply must be given to the private sector,” Ghimire added.

Meanwhile, Digambher Jha, managing director at the NOC, presented a bleak picture of petroleum supply situation and cash flow to import fuel from its sole supplier — Indian Oil Corporation (IOC). He said that the current stock with NOC could only last six days, which in normal situation should be for more than three weeks.

“There’s no way out unless the government hikes the prices or give financial support to bail out the most controversial corporation, NOC,” he claimed.

According to him, the current stock could meet supply of petrol, diesel and kerosene for only six more days, while air turbine fuel (ATF) will last only eight days. Jha said that supply of fuel has already been cut significantly by over 40 per cent, which would be further reduced in coming days.

Citing the import prices of May 16, NOC claimed to have its monthly loss to the tune of over Rs 1.78 billion with the highest loss of Rs 1.10 billion in diesel only. It incurs Rs 413.1 million loss in kerosene, Rs 214.4 million in cooking gas (LPG) and Rs 148.1 million in petrol, while it makes profit of Rs 96.3 million only on ATF.

Dinesh Bhandari, president of National Federation Nepal Transport Entrepreneurs, said, the NOC must be privatised or made an autonomous body with full power to decide on fuel prices. “The political interference in NOC must end,” he said.

Bharat Bahadur Thapa, former commerce secretary, criticised the government for making petroleum products a political commodity rather than a commercial commodity. “The crisis will ultimately end once the politics and petroleum products’ supply will be separated.”

NOC, the outstanding dues of corporation has crossed Rs 14.44 billion including Rs 7.30 billion loans it had taken from the government at various time. NOC has also borrowed Rs 2.15 billion from the commercial banks, Rs 2.54 billion from the Citizen Investment Trust and Employees Provident Fund.

The outstanding dues that NOC owes to IOC currently stands at Rs 2.45 billion.