7 May 2012

Plan to restrict Indonesia's subsidized fuel sales 'delayed indefinitely'

An attendant sits at a closed Pertamina gas station in Tangerang, Banten, in this file photo. The gas station attendant put up a sign reading 'Out of Fuel. Temporarily Closed.' after it ran out of subsidized gasoline. (Antara Photo)
Jakarta Globe - May 3, 2012

Arientha Primanita -- A plan to restrict the sale of subsidized fuel to select vehicles was "delayed indefinitely" by the Indonesian government on Thursday.

"We will temporarily delay the draft regulation until we figure out a workable formula for its implementation," Energy and Mineral Resources Minister Jero Wacik said during a press conference at the Presidential Palace in Jakarta.

The government planned to institute a ban on the sale of subsidized fuel for cars with an engine larger than 1,500 cubic centimeters this month. The ban would also bar new car owners from buying subsidized fuel, restrict its sale in wealthy areas and require the construction of new, non-subsidized fuel-only gas stations.

But officials, after a meeting on Thursday between Jero, Coordinating Minister for the Economy Hatta Rajasa and President Susilo Bambang Yudhoyono, decided the proposed regulation would be too hard to enact. "We've tested new regulations in the field, and found that it would be difficult to implement," Jero said.

The proposal has been in the planning stages since lawmakers rejected the government's planned fuel hikes in March, a move that left Indonesian officials scrambling to find other ways to curb spending. The proposed fuel hikes would have raised the price of subsidized fuel 33 percent, from Rp 4,500 (50 cents) to Rp 6,000 per liter. That plan was scrapped after days of chaotic
public protest. (BeritaSatu/JG)

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