Deputy Minister supports limitation on subsidized fuel distribution

The new deputy minister at the Energy and Mineral Resources Ministry, Widjajono Partowidagdo, has affirmed his commitment to supporting the government’s plan to limit the distribution of subsidized fuels, starting next year.

He claimed that the government had been on the right track by planning to ban private cars from buying subsidized fuels. He added that the plan should have been started in big cities like Jakarta, Bandung and Surabaya, whose fuel consumptions were very high.

“In my opinion, all private cars in big cities have to use non-subsidized fuels, but in smaller cities, we’ll let them use the subsidized ones. We’ll also oblige all public transportation vehicles to use gas-based fuels,” he told reporters at his office in Jakarta on Friday.

To complement the ban, the government must improve the quality of public transportation so that people who could not afford to buy non-subsidized fuel would be willing to use public transportation, Widjajono continued.

“In 2008, when the government raised the price of premium [one of the subsidized fuels] to Rp 6,000, people started to use the Transjakarta buses. But when the price went back to Rp 4,500, they started using private vehicles again,” he said.

To boost the utilization of gas-based fuels for private cars, the government would provide subsidies for converter kits to allow them to use gas, he suggested. The prices of the kits are estimated to reach Rp 10 million per unit.

“Subsidies will be given to kit makers so that the prices can be cheaper and more affordable,” Widjajono revealed.