The price of gas has increased but the government asserts that it could have been worse. Domestic gas has gone up from Rs 250 to Rs 275 for a 12 kg demijohn, which corresponds to a 10% rise. However, the price of non-domestic LPG ? used by the industrial sector and motorists especially ? has increased by 43%.

The minister of Trade, Rajesh Jeetah, made it clear that he preferred to favour domestic gas and liberalise non-domestic LPG as the public would suffer less from the increase of the latter. ?A too important increase in the price of domestic gas would be simply unaffordable for vulnerable people,? he explained during his press conference.

Basing himself on some statistics, he pointed out that the increase could have been even more important if the government had decided to base its calculations strictly on the world fluctuation of prices. The demijohn would have cost Rs 393,29. As 65% of the population are gas users, the cabinet finally took the decision to continue subsidising gas to a great extent.

However, the government may not go on like this for a long time. The State Trading Corporation (STC) will soon have to reduce its deficit. With this in mind, the government will probably have to increase the price of domestic gas again in the near future. Likewise, oil prices will most probably be reviewed upwards according to the automatic pricing mechanism. Because the price is continuing to rise worldwide?