LPG supply

The agitating LPG (liquefied petroleum gas) bottlers and dealers finally called off their week-long strike Tuesday, providing some relief to the distressed consumers of the country. Nepal LPG Industries Association and Nepal LPG Dealers Federation withdrew their protests following an agreement reached with Nepal Oil Corporation (NOC) and after the agitators dropped their main demand – to deny entry of new gas companies into Nepal. It is a good decision on the part of the dealers and bottlers as it indicates that they have woken up to the realities of a free market economy. A restrictive policy that promotes the monopoly of a particular company or group cannot address the growing demand for LPG supply. NOC has rightly started to explore the option of establishing a new gas company under public-private partnership to share its gas importing rights, preparatory to commencing imports from a third country. It is commendable that NOC has also resolved to involve both the LPG industries association and the dealers’ federation in this plan in a bid to open up a working partnership.



The bottlers and dealers, along with state agencies, should realize that customers should not be made to suffer because of the business interests that are widely at play in the whole dispute. They have to ensure that there is continuous supply of this essential commodity. Time and again, the outfits concerned announce unnecessary strikes, thereby putting the public at large to great trouble. This time also, although all the major disputes are said to have been settled between NOC on one hand and bottlers and dealers on the other, it will take another 15 days for the LPG supply in the market to get back to normal as full-scale distribution will start only after the companies import a fresh lot from the refineries of Indian Oil Corporation, the sole supplier of LPG in Nepal. The state should take immediate action under the Essential Services Act and ensure smooth LPG supply the next time bottlers and dealers decide to go for industrial action to press impractical demands.



Meanwhile, the state has to address the major issues obstructing LPG supply in the country. It is a fact that there are an increasing number of problems relating to quality theft, deteriorating standards of gas cylinders and black marketeering. These issues have to be resolved by NOC. Also, while the country’s demand for LPG has increased of late from 12,000 tons to 15,000 ton a year, there is no regulatory mechanism for the sector. An overseeing authority to regulate demand and supply is the need of the hour.

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