Nepal | October 24, 2019

EDITORIAL: Fishy deal

The Himalayan Times

In the meantime, other internal measures should be taken, for example, to promote alternatives to cooking gas, import of electric vehicles at low customs rates, and economizing on fuel

Birat Petroleum, which was recently awarded a contract to import petroleum for the short term, has now cancelled the agreement with the Nepal Oil Corporation (NOC) after the concerned parliamentary committee started investigation into the whole deal, in the process summoning Commerce Secretary Naindra Prasad Upadhyay and the NOC managing director, Gopal Bahadur Khadka, to provide clarifications. But there was nothing wrong in NOC decision to invite global tenders for the supply of petroleum products to ease the current acute shortages of the products caused by the sudden blockade Nepal has faced. Birat Petroleum was chosen and Rs. 20 crore was made available for the opening of an LC account to import petrol and diesel from Siliguri, India. But surrounding this whole episode raised several questions. As a result, the Industry, Commerce and Consumer Welfare Committee of the Legislature-Parliament has been making inquiry into the various aspects of the deal in order to satisfy itself whether the whole deal had been fair and transparent.

One unanswered question is how Birat Petroleum was thought to be able to import petroleum products from the country from which they have not been allowed to enter Nepal despite the agreement between the Nepal Oil Corporation (NOC) and the concerned petroleum corporation of that country. How was the cost of Rs. 199 for a litre of petrol and Rs. 187 per litre of diesel reached? How were the credentials of Birat Petroleum? Indeed, it was to gain without investing next to nothing. In replying to the panel members’ queries, the NOC managing director said it was not possible to import petroleum in such a situation by following the rules and his presentation did not satisfy the panel members. Indeed, his presentation was somewhat irresponsible. In this regard, it was right that the committee formed a sub-panel to study the related documents and look into the matter. And NOC has been accordingly asked to furnish all the documents relating to the deal.

The unilateral scrapping of the deal by Birat Petroleum does not, however, remove the need for deeper investigation into the matter. Why has the firm scrapped the deal after parliamentary inquiry began if there had been nothing wrong. Nobody should be allowed to take undue advantage in the name of a supply emergency in the country, and those who indulge in corruption or who act with bad intent in such a situation should be held to account even more sternly than during normal periods. This said, however, the government and NOC should do everything possible to ease the supply situation. The committee has also directed the government to take necessary measures to have the obstructions in the supply of petroleum and other products removed, to speed up the process of opening the seven border points with China and upgrade the operational trade routes of Rasuwagadi-Kyirong and Tatopani. Other steps should be taken, too, without delay, such as expediting the process of concluding a transit treat with the northern neighbor. In the meantime, other internal measures should be taken, for example, to promote alternatives to cooking gas, import of electric vehicles at low customs rates, and economizing on fuel.

Planes grounded

Among other sectors the scarcity of Aviation Turbine Fuel (ATF) has hit the operation of domestic airlines. Every day more domestic flights are being cancelled. This is very hard on the passengers and tourists. Travelling by road is considered to be unsafe now with the frequent blockades. Some places in the remote region have no roads and people who need to go there have no option other than take flights.

Owing to the fuel crisis domestic airlines used to get refueling facilities from some places in the country. However, this is also to be halted and many domestic airliners have already cancelled most of their flights from Sunday after receiving a circular from Airline Operations Association of Nepal – an organizations of domestic airline operators- which states that the Nepal Oil Corporation would no longer be providing refueling. It is uncertain when ATF will reach Kathmandu. A way must be found to avert the crisis.


A version of this article appears in print on November 09, 2015 of The Himalayan Times.


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