The government can keep fuel prices at their previous levels through subsidies and the huge profit BPC made in the past eight years can be used to cover the losses, experts have said.
Tax and tariff cuts could also be other ways to reinstate the previous prices, they said at a media briefing organised by Independent Review of Bangladesh's Development, a flagship programme of Centre for Policy Research (CPD) on Wednesday.
The policy think tank recommended absorbing the price shock and focusing on recovery should be the government's prime concern at this point.
CPD Executive Director Fahmida Khatun as the keynote speaker said that the state-owned Bangladesh Petroleum Corporation (BPC), which is a monopoly, made a profit of Tk43,138 crore in the last eight years. Despite this, the government hiked fuel prices claiming it was needed to recover apparent losses incurred by the BPC.
"The accumulated profits of BPC should be enough to provide some cushion despite the previously accrued losses. The government can keep prices at their previous levels through subsidies or tax and tariff cuts," she said.
Dr Fahmida added that in view of the economy's recovery from the adverse impacts of Covid-19, stability of fuel price was critical given the strategic nature of the commodity.
Professor Mustafizur Rahman, distinguished fellow at CPD, said that the price hike of diesel and kerosene came at a time when prices for daily necessities were already exhibiting an upward trend.
He said, "The poor and lower-middle class will face a tough pressure due to this price hike as increased product prices will be passed on to them only."
The CPD held the briefing following the recent price hike of diesel and kerosene, with the latter already impacting transport fares.
The fuel price hike is also feared to increase agricultural and electricity costs.
Among others, CPD's Research Director Dr Khondaker Golam Moazzem and Senior Research Fellow Towfiqul Islam Khan spoke at the programme.