There is more than a grain of truth in aptma’s argument that a better form of gas rationing can be adopted than the one employed by the petroleum ministry. True, domestic consumers must not be deprived of the precious commodity. But when 10,000 jobs have already been lost to industry suffering from gas closure, and many thousands more likely if urgent measures are not taking, problems of domestic consumers do dwarf in comparison. As things stand, household and CNG concerns have shut all supply to industry, despite promises to the contrary from the concerned ministry.
The Chinese example is fitting. Caught between freezing consumers and debilitated production, Beijing chose to save the latter. The result is obvious. Most of those provided gas three decade ago, a good many of whom could not afford it, now have a much better (than before) infrastructure, and salaries to afford it. Had they let industry collapse, the resulting wave of unemployment and discontent would have negated most advantages reaped by households.
The proposed solution is perhaps the best mix among possible alternatives. Rather than continue ridiculously subsidising the world’s largest fleet of CNG dependant vehicles, authorities can better transfer the financial cushion to same consumers shifting to oil, channeling resulting gas to industry, propping up employment and setting the more-growth, more-spending train in motion. It is only when households have employment that they can benefit from availability of essential commodities.
The gas question of the day is the oldest ‘optimal utilisation of limited resources’ debate in economics. It is apparent that a more focused form of diversification is possible than presently employed. Instead of defending a position that is no longer sustainable, authorities should immediately gather all stakeholders and arrive at an agreed solution. Cost of failure to do so is immense. No government should need lessons on what can happen when popular discontent pushes people on to the streets.