Slow, realization of gas price regulation

JAKARTA. Ministry of Industry has completed the formulation on the price of gas for industry. However, government needs to conduct limited meeting between ministries related to economic affairs and President Joko Widodo before taking the policy into effect.

Minister of Industry Airlangga Hartanto said that the ministry has set the price of gas for industry at around US$4-US$6 per mmbtu. Unfortunately, Airlangga was still reluctant to give more details on the plan for the price reduction.

As an information, under the third package of economic policy, government has decided to reduce the price of gas for certain industries.

In order to follow up the economic package, government has also released Presidential Regulation No 40/2016 on the Determination of Natural Gas Price. Under this policy, government will determine the natural gas price for seven industrial sectors, namely fertilizer, petrochemicals, oleo chemicals, steel, ceramics, glass, and rubber hand glove sectors.

Aside of the seven industrial sectors, government will also proposed pulp and paper, food, beverage, textile, shoes, and tire industries to enjoy the facility.

Head of Indonesian Food and Beverages Enterprises Association (Gapmmi) Adhi S. Lukman expects that government can immediately settle the plan for reducing price of gas for industry in order to boost domestic industry competitiveness. According to Lukman, the production cost burden has impacted to uncompetitive price. “We have discussed the problem several times”, he said.

(Muhammad Farid/Translator)