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Fuel price hike triggeres protests in Bangladesh; ‘highest such increase in country’s history’

The Sheikh Hasina government on August 5 raised the price of diesel and kerosene by 42.5 per cent and petrol and octane by 51.1 per cent and 51.7 per cent respectively.

bangladesh protestsBangladesh is currently reeling under economic uncertainty, and on July 24  had formally requested a $4.5 billion loan from the International Monetary Fund to combat its ongoing financial crisis. (Photo: @muktadirnewage / Twitter)

Bangladesh capital Dhaka is seeing a wave of agitations as people, including students from various educational institutions, have launched protests against the government’s decision to hike fuel prices.

The government, led by Prime Minister and Awami League leader Sheikh Hasina, raised the prices of diesel and kerosene by 42.5 per cent and petrol and octane by 51.1 per cent and 51.7 per cent respectively, on August 5. The fuel price increase led to a hike in public transport fares.

In an editorial, Bangladeshi newspaper The Daily Star said that this price hike is “the highest such increase in the country’s history”. It went on to add that people in the country are already dealing with “sky-high food prices and galloping inflation”, and this move will only increase to their hardship.

Protesters have demanded that fuel prices be lowered to their previous rates within 48 hours, the hike in transport fares be cancelled, and half fare for students in public transport be ensured, the United News of Bangladesh news agency reported.

“Anarchy is going on in the name of fares in the public transport sector. It has to be stopped. Commuters have to pay two to three times more than the previously fixed fare due to the unbearable condition created by the transport owners,” Ismail Samrat, chief coordinator of the Seven College Movement, said.

Meanwhile, a Supreme Court lawyer, Md Eunus Ali Akond, filed a petition with the High Court on Monday, challenging the legality of the government’s decision to increase the fuel price, according to the Dhaka Tribune. He has also sought a stay on the government notification issued over the fuel price hike.

The advocate said the government has “unreasonably” increased the price of fuel products without holding any public hearing and without getting people’s opinions, which is a violation of law and the constitution. He added that only Bangladesh Energy Regulatory Commission (BERC) could increase the prices of petroleum products after soliciting opinions from people by holding mass hearings under the Bangladesh Energy Regulatory Commission Act, 2003, which the government did not have the mandate to do.

Rashed Khan Menon, president of the communist Workers’ Party, told The Daily Star that this was a “desperate decision” of the government. “It will have a huge impact — politically, socially and financially – on the lives of the people,” he added. Menon is a key leader in the ruling Awami League-led 14-party alliance.

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Bangladesh is currently reeling under economic uncertainty, and on July 24  had formally requested a $4.5 billion loan from the International Monetary Fund (IMF) to combat its ongoing financial crisis. The country’s foreign exchange reserves are rapidly declining, because of the steep inflation caused by the Russia-Ukraine war.

In its editorial, The Daily Star, the official reason being given by the government for the price hike is “price adjustment”, something that it was “forced to do” because fuel prices internationally were much higher than in Bangladesh. However, an unofficial reason that is being given is that the move will help fulfill a key condition of the IMF loan, which is “apparently contingent upon, among other conditions, the withdrawal of subsidies from the energy sector”.

In South Asia, Sri Lanka, facing its worst economic crisis in seven decades, is also currently in negotiations for an IMF bailout. The island nation ran out of foreign currency to import, even its most vital essentials, triggering long queues at petrol stations, food shortages, and lengthy power cuts. Former president Gotabaya Rajapaksa had to leave the country after the protesters targeted his residence.

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Pakistan, whose foreign exchange reserves are rapidly depleting, reached an agreement with the IMF earlier this month to pave the way for the release of an additional USD 1.2 billion in loans and unlock more funding.

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(With PTI inputs)

First published on: 09-08-2022 at 12:57:36 pm
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