JAKARTA. The government's decision to discount the price of gas for the fertilizer, petrochemical and steel industries has sparked controversies. The policy, which is regulated under the Minister of Energy and Mineral Resources (ESDM) RegulationNo. 40/2016 denies the provision of gas price reduction to other industries.
General Chairman of the Association of Glass Sheet and Safety (AKLP) Yustinus Gunawan said that the ministerial regulation does not provide the reduction of gas price for glass, ceramics, rubber gloves and oleo chemical industries. In fact, Presidential Regulation No 40/2016 stipulates the provision of gas price reduction for those industries. Therefore, Yustinus asks the government to clarify the ministerial government, which does not comply with the Presidential Regulation No 40/2016.
If necessary, "the Association is ready to take legal action if the Minister of ESDM ignores the Presidential Regulation 40/2016," Yustinus told TAN, Monday (5/12).
General Chairman of Indonesian Rubber Council Aziz Pane said that the institution has the similar objection. "We definitely will file a lawsuit, because the President has agreed (the gas price reduction), and the Minister of Industry has proposed the discount of gas prices for rubber gloves industry," said Aziz.
However, not all industries that are disappointed with the policy plan to file lawsuits against the government. “What for? (We are) tired. It is clear that the government is not in our favor," said Chairman of the Association of Indonesian Oleochemicals Producers (APOLIN) Togar Sitanggang, annoyed. In fact, the government only provides the gas price discounts for state enterprises.
A glass manufacturer, PT Mulia Tbk Industrindo, which expected to obtain gas price discounts, was disappointed. However, the company remains hoping that the government changes its stance. "We believe that the government will work on it," said Corporate Secretary Mulia Industrindo Henry Bun.
As a glass producer, Mulia hopes to obtain discounts of the gas price to $ 6 per mmbtu of gas. The current gas price is currently US $ 8-US $ 9 per mmbtu. "If the gas price goes down, the cost of production will drop by 7% -8%, and we can export,” said Henry.
In responding to the demands of employers, Minister of Industry Airlangga Hartanto said that the Minister of ESDM Regulation No 40/2016 is an initial regulation, which will be followed with the subsequent rule, namely the regulation on the additional industrial sectors recipient of the gas prices discounts. "This is just the beginning. The discussion has not completed yet," said Airlangga.
Director of Upstream Chemical Industry at Ministry of Industry Muhammad Khayam, added, there will be other Minister of ESDM Regulations, which stipulate the gas prices for other industries. However, those will just take effect next year. “We will continue the discussion for four other sectors, "said Khayam.
Constitutional Law Expert Margarito Kamis assessed that not only Minister of ESDM Regulation No. 40/2016, the Presidential Regulation No 40/2016 is also problematic, since the presidential regulation stipulates that the gas price reduction is retroactive since the beginning of 2016. "From the constitutional perspective, the regulation is flawed," said Margarito.
(Muhammad Farid/Translator)
