I would have demanded Hasina's resignation over fuel price hikes, but not now: Zahed

Prime Minister Tarique Rahman's Information and Broadcasting Adviser Zahed Ur Rahman said he would have demanded Sheikh Hasina's resignation over a fuel price hike but would not make the same call against the current government, which he said was elected by the people.

"If I were not in government and were an activist, I would protest against this. During Hasina's time, I would not only have protested but also demanded her resignation. Now, that would not be appropriate," he said at a briefing on the government's activities at the Secretariat today (22 September).

Zahed said he viewed the Awami League government as lacking legitimacy, while the current BNP-led government had received a public mandate.

"We did not own that government because it did not have legitimacy. But this is a government elected by the people. This is our government," he said.

The remarks came after the government raised the prices of diesel, kerosene, petrol and octane by Tk20 per litre from Monday amid a sharp rise in international fuel prices. Diesel now costs Tk135 per litre, up from Tk115.

Explaining the increase, Zahed said Bangladesh Petroleum Corporation (BPC) had been selling diesel below the prevailing international market price and incurring substantial losses.

"BPC is losing around Tk89 per litre on diesel. The daily loss is around Tk109 crore," he said.

He said losses from diesel alone could reach around Tk40,000 crore annually if the current trend continued. The Tk20-per-litre increase, he added, could reduce the annual loss by around Tk10,000 crore.

The government has separately cited rising international fuel and freight prices and BPC's losses as reasons for the latest adjustment. According to the Energy and Mineral Resources Division, BPC incurred losses of about Tk22,875.66 crore between March and August.

Zahed said the government was still providing substantial subsidies in the energy sector despite the adjustment.

Although international fuel prices had eased somewhat, he said the overall situation continued to put pressure on public finances.

Govt weighs political cost

Asked whether the fuel price increase could cause political damage, Zahed acknowledged that the decision would add to people's hardship.

"We did not take this decision with the intention of making people unhappy," he said.

He said the government was aware of the political sensitivity of increasing fuel prices ahead of the upcoming local government elections, but also had to assess how much subsidy it could sustain.

Zahed said the government had no alternative but to weigh the immediate impact on consumers against its ability to finance the energy sector. The Daily Star separately reported him saying the government knew the decision would increase people's suffering but considered the adjustment necessary.

Zahed said the current fiscal year's budget had allocated around Tk48,000 crore in subsidies for the gas and power sectors.

Nearly half of that amount, he said, had already been spent within the first two and a half months of the fiscal year.

"If this trend continues, subsidies for gas and electricity could reach Tk1.25 lakh crore to Tk1.5 lakh crore by the end of the year," he said.

The total pressure on the budget would be even greater after including subsidies for fuel oil and other sectors, he added.

The adviser said the government also had to finance social safety-net programmes, education and healthcare.

"So, we have to balance allocations within our limited resources," he said.