India to ‘consider’ cheaper LPG for Bhutan

Bhutan is facing a fierce crisis, as cooking gas prices hit the roof because neighbour India suddenly lifted its ‘special subsidy’ on LPG. Some observers have said that India is giving its tiny neighbour a dose of ‘gross national unhappiness’ because  the tiny Himalayan country is seen as ‘cosying up’ to the Red Dragon, China.

Amidst reports of deepening crisis in neighbouring Bhutan following withdrawal of subsidy on kerosene, LPG and power tariff, the Government of India is awaiting a formal communication from Thimphu after which the country’s request may be considered.

Sources in the Ministry of External Affairs (MEA) said the Ambassador of Bhutan is likely to meet External Affairs Minister Salman Khursheed to hand over a request letter from the Interim Government. Khursheed, meanwhile, is leaving for Nepal on Tuesday.

It is only after the letter is formally handed over to the External Affairs Minister that New Delhi would consider their request and a view would be taken, said sources.

Earlier reports indicated that the Bhutanese Ministry of Economic Affairs, through the country’s New Delhi Embassy had already requested the Government of India to look into the withdrawal of subsidy, which has led to serious price escalation of fuel in the Himalayan Kingdom.

“We’ve requested the Ministry of External affairs to intervene, considering the impact it will have on consumers in Bhutan, and to continue to subsidise these products, in view of the existing friendly relations between the two countries,” the Interim Government’s advisor to the Economic Affairs Ministry, Dasho Chhewang Rinzin was quoted as having told the Bhutanese media.

Earlier, the Department of Trade released a circular announcing that prices of kerosene and LPG cooking gas would increase, because the Government of India had withdrawn subsidy on these items from July 1.

Bhutan had a quota to lift 700MT of subsidised LPG every month from India. The kerosene quota is 1,200Kl a month, consumption of which normally increases in winter. The LPG and kerosene are supplied from refineries in Assam.

However, on July 1, without citing any reason, India has cut the subsidies. New Delhi’s action is seen as a subtle message to Thimphu in retaliation against its reported bid to get closer to China. Considered India’s closest ally, Thimphu at the prodding of India had launched a military operation against outlawed ULFA and NDFB, forcing the militant outfits to shift base to Bangladesh.

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Posted by on July 9, 2013. Filed under Bhutan,SOUTH-ASIA. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.

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