Spiraling gas prices are the result of smuggling of gas to Pakistan, the Oil and Gas Enterprise Department says.
There has been a crippling shortage of gas for the past six months.
There has been a crippling shortage of gas for the past six months.
Gas from Afghanistan is smuggled across the border, leading to a shortage that pushes up domestic prices even further, say authorities.
The minister’s council decided to ban gas transit, which immediately reflected in a hike in prices in Pakistan. The legitimate transit trade went underground.
Faridullah Sherzai, head of Oil and Gas Enterprise Department, warned the media on May 19 that prices in Afghanistan could climb even higher if smuggling is not curbed.
He said the smugglers cross over through Spin Boldak border. Security officials have been told to stop the smugglers who “want to destroy the economy,” Sherzai said.
The government has also set a price for gas: one kg is to sell for 40 Afs (1 USD is roughly 55 Afs). “We are trying to hand over those who break the law to the police,” he says.
However, gas sellers say they sell at a higher rate to offset other costs like the cost of transportation of gas to their shops.
Ahmad who is a gas seller in Fourth Makrorayan in Kabul says he pays 400 Afs to hire a taxi to fetch the gas.
Fareed has a shop in Macroryane Kohna. He says he was selling gas at 38 Afs before the price rise. Now it is 45 Afs. “Gas importing companies say prices have risen because the dollar exchange rate has gone up,” he says.
Hit hard
Consumers are paying even between 60 and 70 Afs for a kg of gas.
Mohammad Akbar of Qala-e-Zaman Khan area of Kabul says shopkeepers sell at whatever price they wish.
Hasan Ali, a resident of Char Qalae-Wazir Abad, says a poor man has to pay “half his wages” for the cooking fuel.
Abdul Satar who lives in Kandahar says “the government not only does not control the price in the bazaar, it does nothing to prevent its smuggling to Pakistan.”
The Afghanistan Chamber of Commerce and Industries blames the government’s decision to curtail gas transit for the high prices of gas.
Khan Jan Alokozai, deputy chairman of the Chamber, told Killid many containers for Afghan traders have been held up in Karachi Port as a result of the government’s decision.
Alokozai further says that the best way to solve the problem of scarcity is to import gas in larger quantities than necessary – Afghanistan would have enough and also be able to export gas. “If Afghanistan needs one tonne of gas it should import ten tonnes. With this Afghanistan would earn taxes.”
Custom offices were collecting tax from the gas transited to Pakistan legally through Torkham, Khost and Wesh (the border between Kandahar and Pakistan) before the ban, which only pushed the trade underground.
Restrictions were also against the spirit of APTA (Afghanistan, Pakistan Trade Agreement) of 2010.
Afghanistan needs a single policy on transit trade so individual departments cannot do what they want, he urges. “The agreement of APTA has been signed by president Karzai as well as the minister of commerce. Yet the head of one department in Ministry of Commerce has sent a letter to Ministry of Finance (MoF) to block the transit of gas,” he says.
Meanwhile, according to Alokozai, the Environmental Protection Agency has sent a letter to MoF recommending a ban on export of medicinal plants, a major export. This will have repercussions on the Afghan economy, he says.
