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The Financial Express

Devising energy policy judiciously


Devising energy policy judiciously

Energy Adviser Tawfiq-e-Elahi Chowdhury was candid when he recently told the press that it was better not to reduce the price of fuel oil as the international energy market is very unpredictable.

The move made Monday (August 29) last week by the government was indeed a rarity in a country where prices of commodities are known for their tendency to go up. And once they do so, they refuse to come down.

And the law of demand and supply that dictates markets everywhere does not apply here.

The general public has got used to it because they know that such anomaly is the rule in this part of the world.

So, the news did not make much impact on the public. Moreover, calculations made for different services, for example, transport, show no significant impact of this fuel price reduction on the bus fares whether within the city or on the long cross-country routes. 

It will be embarrassing for the government if the price has to be readjusted meaning increased in case the fuel oil price again becomes volatile in the international market.

There is no valid reason why it should not be considering that the Ukraine war is showing no sign of respite.

Some economists, for instance, Dr Debapriya Bhattacharya, a distinguished fellow of the policy think tank, Center for Policy Dialogue (CPD), has even questioned the wisdom of making such a seemingly unscripted announcement by the government minister concerned as there was no previous  reports of any such discussion being held in the committees concerned in the finance ministry.

So, the question would naturally arise if the decisions on issues as important as energy price, is being taken unilaterally or if a system is at work at the policy-making level in this regard.

As the reputed economist pointed out such sudden changes in the energy price betrays fiscal disharmony. At a time when advanced economies of Europe are reeling from the impact of Ukraine war as their biggest supplier of fuel, especially gas, Russia, has practically switched off its supply to them in reaction to their (Europe's)  having imposed crippling economic sanctions on the former, small economies like Bangladesh have reasons to be circumspect.

Bangladesh simply cannot afford any unpredictability at the policy level when it comes to an issue like energy. And it needs also to be kept in mind that fuel, or energy, for that matter is not just one of a host of other issues that the government has to deal with.

In fact, it is the only issue, if we are talking about a modern-day economy. For without an assured supply of energy, the lion's share of which still comes from fossil fuel, life itself would come to a standstill.

Unsurprisingly, alarm bell has already started ringing at the European  capitals with the approach of winter. For all this Russia is being blamed as it  invaded Ukraine and that it (Russia)  is using its gas and oil to, what it,(the West), says, to 'blackmail' Europe. But what about Europe and its ally, America applying punishing sanctions on Russia to cripple its economy?

But then isn't  it 'moral' because these (sanctions) are meant to prevent Russia from committing its 'immoral or unjust' act of attacking Ukraine! What about Russia's taking countermeasures to protect itself against western sanctions, say, through taking retaliatory measures like switching off gas supply to what it thinks an adversarial Europe?

It's indeed a paradox of the moral kind! This kind of 'one-way' morality is perhaps not going to take the present global crisis anywhere near solution. The worse victim of such crisis as always are the weakest parties on the fringe like Bangladesh. So far as the issue of energy security is concerned every country will have to fend for itself and no country is going to come to the aid of another.

As the world's leading powers in Europe and America are not in any mood to strike a peace deal with Russia, if only on 'moral' ground, the rest of the world is left to taste its bitter fruit.

But which war was ever moral or just? Was the Iraq war, or the Afghan war or the Vietnam war of the past century just or moral? Who decides it?

And the question of who started it first is also often a fuzzy one. In the first World War, for example,   Germany was held responsible for starting the war and made to pay a price for it. But what came after in the WW2, should have by now persuaded humanity to think differently rather than holding a particular party responsible for a war and try to punish it on that ground. In truth, in the wider sense there was never a winner in a war.

Justifying any extension of war always comes at a huge cost in the shape of immense suffering of the common people caught in the crossfire of warmongers on either side of the political divide.

It is indeed in a dangerous world without great statesmen we have found ourselves at the moment.

As there is none to look up to for guidance in these crisis times, developing countries including Bangladesh will be required to devise their energy policy depending on their own resources and abilities. Any misstep in this regard needs to be avoided at all costs.

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