Protect LPG industry

12 April, 2021 12:00 AM printer

A safe environment and fair competition is the basis of flourishing any business. But, the Liquefied Petroleum Gas (LPG) sector is yet to get that space. The LPG industry has drawn the attention of a number of investors for some obvious reasons, including the prospective demand for LGP in the near future. However, they are now in a dilemma about their business as some multi-faceted factors continue to influence the future of this sector’s vast investment and growth potentials.

A large amount of money has already been invested in the sector. The investors have developed a vast network even in the rural areas, maintaining distribution and retailer points. Besides, the companies have been paying extra money, in some cases much higher than in any other developing countries. Moreover, their expense increases to a great extent due to lack of infrastructural facilities like deep seaport crisis and small vessels. But, they are struggling to get expected revenue; in some cases, the companies are forced to reduce price to the retailer level even without making any profit. Given that, many investors are now thinking of pulling out their investment, which will impact on the national economy negatively.

It is assumed the pressure of piped gas in Bangladesh will reduce significantly by 2030. So, we are now heading to supply of LPG for households reducing dependency on gridline gas. LPG is gradually substituting natural gas not only in households but also in the commercial sector. Therefore, any instability in the LPG sector will hinder government plan to use natural gas for industrial purposes only. Besides, the fate of the people involved directly or indirectly in this business will be uncertain.

That the demand for LPG will be double in the next few years implies the need for continuous investment in the sector. The government has indeed been continuously supporting this sector. To enhance this support, the barriers that hinder the business must be removed as soon as possible. The government must ensure the business environment so that an entrepreneur need not plan to withdraw his investment.