KATHMANDU, Aug 15: The government and striking Liquefied Petroleum Gas (LPG) bottlers on Tuesday agreed form a technical committee to fix the profit margin on import and distribution of gas.
According to Narayan Bidari, director general of Department of Commerce and Supplies Management (DCSM), the committee would recommend the reasonable profit margin for bottlers after studying the transport fare and overhead costs while procuring and distributing the LPG.
“We have made a draft of an agreement incorporating the points agreed on previous negotiations. Hence, we have called agitating bottlers to come to us for formal negotiation.. We are ready to increase the profit margin if the study suggests so,” said Bidari.
Bottlers have demanded the government to raise bottlers´ commission (profit margin) to at least 5 percent of the retail rates, which at the present prices will stand at around Rs 70 per cylinder. So far, they were allowed to take profit of around Rs 30 per cylinder.
Nepal LPG Industries Association (NLPGIA) has also been demanding that the government withdraw its decision to introduce dual cylinder and pricing system planned to be enforced from August 17.
Bidari, who is also the coordinator of the government negotiating team, said the government was ready to resolve the problems that may crop up during the implementation of the dual cylinder system.
However, blue colored cylinders must be supplied to commercial consumers such as hotels, restaurants, factories and automobiles so as to making such users pay as much as actual import rate. As per the new system, the government will allow LPG bottlers to continue selling gas at the existing subsidized price to the household consumers in the red colored cylinders.
After series of talks between gas bottlers and officials of Department of Commerce and Supplies Management (DoCSM) failed to yield breakthrough, chief secretary Lila Mani Poudel intervened and issued strong warning to agitators to immediately withdraw their strikes or face tough action enforced through the Essential Service Act that provides sweeping power to law enforcement agencies enabling them to use force to intervene in supplying essential commodities including gas.
However, agitating bottlers said they have not fully withdrawn their demands. “Our agitation is still continuing though we are positive on some issue,” said Shiva Ghimire, senior vice president of the association, said.