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Nepal
Kathmandu’s Fuel Crisis
About two weeks ago, I was in line at around 6:30 in the morning to fill up my small Korean car's petrol tank. As I waited amongst dozens of vehicles, an interesting conversation about biofuel and its impact on global warming, rain forests and the world's fuel supply was being aired on BBC, via 103FM in Kathmandu. It is unclear when Nepal plans to seriously adopt any form of alternative fuel, but the insufficient supply from Indian Oil Corporation (IOC) this year, because of Nepal Oil Corporation's (NOC) outstanding debt, has been tough on every motor vehicle owner in the city, especially those whose livelihood depend on it. IOC has also had a long monopoly of fuel supply to Nepal, though it was only as recently as spring of this year when the organization decided to allow Nepal to seek other fuel suppliers.
The problem heightened last week when IOC decided to supply NOC with only 1,200 kiloliters of fuel as opposed to the normal supply of 2,000. The shortage has also forced many private pumps to remain closed, while institutional pumps operated by security forces and Sajha Corporation have themselves been running out of supply on a regular basis.
[vimeo 231256]
These video clips, taken around Hariharbhawan, are of vehicles lined up to buy fuel at the Sajha Petrol Pump. Scenes like these have become normal at pumps in Kathmandu. Yesterday, the Sajha pump closed at midnight after running out. "We have been selling at least 12,000 liters or petrol and around 7,000 liters of diesel everyday for over a week now," an employee of the pump said. "Most times, we close the pump when we run out of fuel, and we have been running out of fuel everyday. But it's been like this because of the shortage."
An unprecedented growth rate in the number of privately owned small and large motor vehicles as well as an unmonitored influx of mini vans and buses used for mass transit during the last five years in Nepal have helped steadily increased the country's demand for petrol and diesel. However, Nepal Oil Corporation (NOC) has been consistently unable to clear their dues with the Indian Oil Corporation, largely because of their monthly losses which run up to millions of rupees.
The prices of petrol, diesel and kerosene have all increased many times in various intervals during the last two years alone. Such increments have also traditionally been a popular cause for political parties and their student wings to hit the streets in protest, such as when the Royal government had tried to increase NOC's revenue by increasing the prices by certain percentage. Today's rate stands at approximately $3.95/gallon (Rs. 67/liter) for petrol, and approximately $3.15/gallon (Rs. 53/liter) for diesel.
NOC is staying afloat due to billions of rupees it has taken as loans, and its key supplier is no longer willing to supply petroleum products to Nepal on credit. According to Kantipur publications, the Nepali government extended a loan of Rs. 1.7 billion to NOC on 3 July, while the total amount payable to ICO was Rs.4.5 billion. However, the government has been very passive to its otherwise progressive decision in January 2004 to use ethanol-based biofuel in Nepal, which could decrease the amount of petroleum import by 10%, if not more. It also has the possibility of being a much cleaner source of energy, and could be a boost to the farming/agriculture sector in Nepal. However, neither has a serious supplier of ethanol emerged nor does the government seem to be actively seeking one. The government has also made buying an electric vehicle a particularly expensive experience. The petroleum industry is, after all, large and lucrative, and commands influence at various levels of commerce and government.
Mass use of both biofuel and electric vehicles could ease burden on NOC. But the government is under-serving its people and the state with its short-sightedness by not actively pursing cleaner and renewable sources of fuel. It is reckless not only to national security and economy, but also the fast degrading air quality of Nepal's urban centers and the larger issue of global warming. While it is forced to regularly keep the NOC afloat by issuing colossal loans, now a long standing practice, the leadership of Nepali politics is yet to initiate investment or research of alternative fuels, primarily those based on cellulosic ethanol or biomass. And instead of giving tax breaks to electric vehicles, the government currently imposes a variety of taxes making it an unfeasible medium of transportation. A popular electric vehicle movement could usher in an era of big and small urban solar farms, in private homes, offices or public spaces. But the government as well as some in the solar power industry consider solar power in Nepal as something limited to heating water, or to lighting a few bulbs or running water pumps in rural parts of the country where there is no electricity.
The initiation of these two new industries —alternative fuel and urban solar farms —could create many new jobs and help the economy and make the country a lot more independent than it is now. And it would ease the burden on both Nepal Electric Authority as well as NOC. To many, this is common sense. To the political leadership in Nepal, this is possibly something that will need a lot more than just common sense —perhaps a certain international bank, or a donor agency. Of course, there won't be immediate justice, peace and other idealistic changes in Nepal after the Constituent Assembly elections. But it hasn't stopped political parties from promising Nepalis the world and more. Unfortunately, a "green Nepal" isn't even a part of a false promise in the "New Nepal" yet.
So for now, it seems, Kathmandu's air quality will continue to go from bad to worse, NOC will continue to run huge loses and acquire even larger debts, and lines of motor vehicles, 4- and 2- wheelers alike, snaking around areas near fuel pumps will be a fairly common sight. At this rate, the "New Nepal" will have many of the same old problems.
Comments
Kashish, that’s a wonderful article. I enjoyed reading it. Keep up the good work.
Yes! How can one afford a car, when our economy is so poor? I live in the US and I am still poor.
Thanks for bringing news from different angle.
Pema
Former Malpien.
Melodramtic us!
I remember growing up in Nepal (1980s) when the trade agreement collapsed becuase two heads of state didn’t like each other and everybody in Kathmandu panicked. My father who wouldn’t move his butt for anything was emphatically recruiting us to line up for extra gallon of gas. Then came the salt shortage hangama and the onions, patatoes, medicines, and all that. Yet we don’t learn any lessons. We are addicted to this melodrama of shortage and panic. We don’t do anything about it.
I visited Nepal after 6 years of being away. My Gosh there are more cars and than people. After being stuck in stand still traffic continously I decided to walk everywhere. Of course there is that social stigma attached to you for walking.
“Looser” : -(
I personally think Kathmandu first needs to go green otherwise our old city is going to collapse. (This might put an end to “I have a got a nicer car” syndrome) The Bagmati river unfortunately smells and filled with slug and dirt. So much respect for our own mother earth. I grew up playing in the river and this time I was ashmed, pained to see the river turn black.
Enough said…
Its time Kathmandu goes green!
Introduce Effecient Public Transportation
High taxation for owning a car
Blah blah…
Ke Garne Hamro Gaaf mai din jancha!
These issues, which have been a regulation over past few decades, only evoke ennui. It has been so much in the norm that it does not even demand empathy. There has been enough said and done in the past to mar the government and our own system of belief, but has anyone actually sought after a solution?
I recall an incident a few years ago where there was a glimmer of hope when CIAA investigated few high profile politicians, bureaucrats, businessmen and also the then premier (ironically, he still exists as one) Girija Prasad Koirala over an anomaly of misuse of their position along with corruption. The outcome may have hit the sand, but it could have started off a good practice of implementing rule of law which unfortunately was not retained.
Dearth of energy and other outstanding resources percolate from the wake of political and bureaucratic malfunction. And if there is not an independent, autonomous, and stern judiciary panel to monitor the consumption and procurement of these resources, we might as well choose to live in mayhem forever.
Here goes a small list of a procedure that could alleviate the current issue to some extent.
Corrective actions:
1.Creating an autonomous panel (that altruistically serves the purpose and does not buckle under political coercion, kickbacks, favoritism, or simply lassitude) of judges, engineers, administrators, and perhaps diplomats to monitor the usage and procurement of energy.
2.Introduction of access controlled computerized system to ensure sale and dissemination of energy products are recorded and are traceable. Double entry systems are precarious and subjected to malicious alterations.
3.Constant supervision of all present transportation vehicles that operates on gasoline and similar organic fuel. Despite strong criticism from the commercial and private vehicle owners, rundown automobiles should be instantly discarded, wherein, the government should be able to settle a necessary compensation to the vehicle owners. Refraining from superfluous elections every few years allocates enough budgets for this sole purpose.
4.There should be an unvarying scrutiny and audit of the amount of fuels disseminated to the vendors.
5.The fuel delivery system should be well calibrated to the international standard and should be computerized with an access control.
6.Government should lower taxes significantly on fuel-efficient, non-polluting automobiles that primarily operate on solar power, LPG, battery (or fuel cells), and increase taxes on vehicles used for private purpose that run on gasoline.
7.There has to be an effortless conveyance of fuel and other such supplies from Barauni, India. Both governments can hold talks in commissioning well-guarded pipelines form transportation of fuel.
8.Similar concord should undergo with Bangladesh too.
9.Redundant bureaucracy should be discouraged, rapid workflow should be enhanced.
Preventive actions:
1.Research and development for alternative fuel should be practiced at a full scale. It might require international assistance at every level.
2.Seek technical and (huge) financial support from the developed nations to augment exploration of energy resources such as constructing mines, commissioning refinery etc.
The list has no end, but it could serve as a miniature SOP for a long term planning.
Just my two pennies.
Does anyone know of any country in the world (except maybe a few in the Middle East) whose government subsidizes fuel for it’s people? Just curious.
i have been wondering if it was possible to drive a safa tempo as a private vehicle.. or one of those battery-operated tempos. batteries are another environmental hazard no doubt, but they can be recycled and all - plus with the present petrol crisis, wouldnt that be a good option? any idea if its possible to privatize a battery tempo?
To Bhundai Pundit,
GON subsidises kerosene, the more affordable fuel.
Can it be that I could see few more pictures.
what;s going on our cantire
New Government is just closing eyes on this matter why? They say that they work for the public but they are working only for themselves. This is very shame.
Firstly, i wake in 5’o clock in the morning,
and when i got to basin there was no water, then i have to make my college dress ready, there was no electricity to iron my college uniform.
anyway i manage it with those clothes , then i got to bus stop, then i waited for the bus, but there was not a single bus coming due to “FUEL SHORTAGE”. after 33 minutes, one bus did come but was too pack but anyhow i managed myself to hang on the door. When i reached college, it was already late. i missed my important physics class.
And about a mid day, the state was announces as “Strike”. OK, now somebody help me to return my home.
And this is our Nepal.You must be acquainted with all these things. it’s a regular activities.
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how do people really have cars? I can not imagine balancing budget with income. What’s the average Salary of Nepali Sarkari Jagir ? How much do they earn ? and how come they still drive cars ?