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Corporate - Management - February 13, 2023

Entrepreneurs in great trouble

Price hike of gas & electricity

Mahfuja Mukul: Gas and electricity prices are increasing day by day. After a few months, the gas and electricity price hiked on the industrial sector repeatedly. The owners of industrial factories have lost their direction. They are struggling to cope with the pressure of price increase. Along with that, you are not getting uninterrupted gas and electricity. In the meantime, the increase in the price of gas and electricity has increased on the industrial sector.
Related sources say that according to the notification of the Department of Energy and Mineral Resources, the price of gas per unit in large industries has been increased from Tk 11.98 to Tk 30. Accordingly, the price has increased almost three times. At the same time, the price of gas per unit has been increased from Tk 16 to Tk 30 for industrially produced own power plants (captive).
Before this, the Department of Energy and Mineral Resources held meetings with businessmen for the last few months regarding the gas crisis. The businessmen agreed to pay up to Tk 25 per unit of gas to save the industry despite the increase in the cost of production. But they wanted assurance of uninterrupted supply. But instead of that Tk 25, even Tk 30 is not enough for uninterrupted gas supply. If this situation continues, the owners do not see any other way than the destruction of the industry.
Industrial owners said that the effect of gas and electricity price hike will affect every sector of the industry. In the meantime, dyeing bill has been announced to increase, knitting bill is also increasing. Along with this, the price of all goods and ancillary raw materials has increased. As a result, the cost of the product will increase.
At the same time, uninterrupted gas-electricity is not compatible. Industrial owners will lose their ability to compete in the international market. Negotiating with buyers will make it difficult to bring in orders at increased prices. All in all, industrialists are facing a multifaceted crisis.
Owner of an apparels Akhter Hossain Apurbain Fatullahsaid, “We work with advance orders of 4-5 months. A sudden increase in gas and electricity prices will make it difficult to pay those who have already taken orders at the previous price. As gas and electricity prices have been hiked since February, production costs will also increase. Our profit margin will decrease. Some may incur losses. Because if the cost of production increases, the price will increase. As a result, they will fall into both crises.
He also said that the price of everything has already increased. Now if the price is increased again then the order quantity will decrease. A decrease in quantity will have a negative impact on exports. The dollar will also be less. That will affect the reserves. And if the reserve is reduced, I will not be able to do LC. All in all, there is a possibility of getting into trouble.
He also said that since the price has gone up there is nothing more to do. But in this situation, we want uninterrupted gas and electricity. But that too is not being given. The hike in gas and electricity prices has come into effect since February. But there is no gas in Narayanganj region for a week. No gas for 13-14 hours out of 24 hours. As a result, production is decreasing. On the one hand the product production is decreasing and on the other hand air is entering with gas. We also pay the air bill.
Vice President (Finance) of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) Morshed Sarwar Sohel told that it is normal to have an impact on gas and electricity prices. But we could overcome it if we had uninterrupted gas-electricity. A cover in production could have been solved to some extent if we had uninterrupted gas. Since the government has to give subsidy, we could have given feedback from the field as well. But only one thing we have to give pure gas.
Sometimes gas comes with air. That has to pay the bills. Absolutely pure and unadulterated gas must be given; To be able to unload goods in three shifts in dyeing. Now goods can be unloaded in two or one and a half shifts.
He also said that the government has already declared self-sufficiency in electricity. The price has been increased accordingly. So why is the price increased now? Even after being self-sufficient, if it goes negative, then as a citizen, one has to be ashamed of other countries. I hope the government will look into the issue of gas and electricity.
He said uninterrupted gas and electricity is very much needed for the development of the country. If we want to move towards a developed country then gas and electricity should be fully provided. If gas and electricity are available uninterruptedly then we can cover the government as well as we can go forward in terms of foreign exchange earnings.
However, he said, “We thought it would be increased between Tk 22 and Tk 25. But that was exactly Tk 30. Raising so much money at once is difficult for us. Because our orders are taken at least three months in advance. This time should have been given. Buyers who have taken orders will not suddenly increase their prices. In this case, the government should think a little more and take a decision. Still, I will work for the development of the country.
Executive President of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) Mohammad Hatem told that due to the increase in gas prices, its impact has definitely been felt everywhere. In the meantime, dyeing bill has been announced to increase, knitting bill is increasing. All the accessories and accessory materials have increased in price. Because their production cost has also increased. There is no escape from this situation.
But I think there is a chance. A request has been made to all concerned including the Prime Minister and the Minister of State for Power that the increased rate will be effective from February. But in February we are not getting gas. Since the day the price hike was announced, the situation has been going from bad to worse. Especially in Narayanganj zone since that day the gas crisis has become very evident. On one hand we will not get gas, on the other hand we will pay increased price.
It is actually a base for us. We would request that the increased rates be implemented from when normal gas can be supplied. Tk 30 is reduced at least as much as possible.
Bangladesh Small and Cottage Industries Corporation (BSIC) Narayanganj Assistant General Manager (Acting) Muhammad Ashikur Rahman said that it is normal to have an impact on gas and electricity prices. Even if there is a small increase in the industrial sector, its production cost increases. The pressure falls on the association. In some cases, there is also a delay in the payment of salaries and allowances. Impact on the export sector.
But once the industrial owners said that there is no objection even if the price is increased if there is uninterrupted supply of gas. It is in that context that the government may have hiked gas prices for uninterrupted supply. After all, the price increases this time as a percentage is slightly higher for industrial gas. This price should have been increased after discussing with them. However, even if there is some impact, it seems that there will not be much impact on the export earnings. And we export more here.
Dhaka Power Distribution Company Limited (DPDC) Fatulla Region Executive Engineer SamchuzzamanMoktadir told that power supply is not stopped without any important reason. There is no chance of shutting down the power supply unless there is a problem with the system. We try our best to keep the supply right. And in case of emergency or breakdown, the power goes out for a short time. Moreover, no load shedding is provided.
Mamunur Rashid, deputy managing director of Titus Gas Narayanganj office said, “I have informed the higher authorities about the gas crisis. We will try to solve the problem as soon as possible.

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