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Diesel, Kerosene subsidies end - Price raise to 170 fills from 55
October 16, 2014, 8:37 am
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His highness Prime Minister chairs The Cabinet and the Supreme Council for Planning and Development meeting.

The Cabinet and Supreme Planning Council have decided to lift the subsidy provided by the State for diesel and kerosene, which thereby will increase its price in petrol stations from KD 0.055 per liter to KD 0.170, informed sources say. In a press statement issued by the Minister of Social Affairs and Labor, and State Minister for Planning and Development Affairs Hind Al- Sabeeh following a joint meeting held in Bayan Palace, which was headed by HH Prime Minister Sheikh Jaber Al-Mubarak, she said,

“The study includes modification of Paragraph 1 of Cabinet’s decision 534/2007 to provide subsidy only for airlines with over 5,000 flights through Kuwait annually”. She added that the committee will be responsible for following up the consequences of this decision and figuring out ways to handle them through implementation of proper procedures.

The minister explained that the key topic in the agenda of the meeting was a proposal submitted by the Ministry of Electricity and Water regarding the tariff categorization of consumption of electricity and water. She indicated that they will resume discussions regarding the issue with the Economic Committee, provided the concerned ministries present a vision that will cover all the categories, the targeted amount that will be saved and the impact on various sectors and economic activities.

Al-Sabeeh stressed that the impact on the standard of living of Kuwaiti families particularly those earning low incomes must be considered before reducing the subsidies so that their financial burdens are not increased. However, she hinted that such people will not be harmed with the current decision, indicating that the remaining details will be discussed in an upcoming meeting.

Meanwhile, informed sources affirmed that the decision to lift the subsidy will help the State save billions of dinars in the next 15 years, adding, “The members of Cabinet and Supreme Planning Council have agreed to implement this initial plan until sufficient studies are presented by the Supreme Planning Council covering affected sectors such as industrial sector, farming, and agricultural and fisheries sector”. They said the Cabinet has summarized its decision by stating that the decision will enhance competition in Kuwait and will not affect citizens except on a very small scale.

They affirmed, “The main objective of the decision is to reduce wastage, and not increase the State’s revenue as thought by some. The only people who will be affected are those who waste electricity and water”. The sources added, “The concerned committees will discuss the negative aspects about the decision during regular meetings”. Meanwhile, sources from Kuwait National Petroleum Company (KNPC) revealed that the actual cost of diesel and kerosene is about KD 0.300 per liter while the subsidized cost of these products is KD 0.055, which means the government pays KD 0.245 per liter. They explained that the cost proposed by KNPC is KD 0.170 per liter, which is to partially lift the subsidy.

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