REPUBLIKA.CO.ID, JAKARTA - The government is preparing three scenarios to prepare for a hike to prices of subsidized fuel as part of efforts to curb fuel subsidies. Deputy Minister of Energy and Mineral Resources Widjajono Partowidagdo said on Monday that the three scenarios included raising the price of subsidized fuel oil for private vehicles by 500 IDR, 1,000 IDR or 1,500 IDR per liter.

The government is also discussing the possibility of raising the price of subsidized fuel oil for public transport vehicles, including small-scale business vehicles, by providing cash back as compensation. "If the increase is 1,000 IDR per liter, the cash back will be as much as that amount," he said.

To implement of cash back system means the government must provide control cards. This step is not difficult, Partowidagdo says.

Though the price hike will not apply to motorcycles under this scenario, the fuel price will still be raised. Yet, the increase will not be as high as that of other vehicles.

In addition to these options, he says the government is also studying the possibility of providing fixed subsidies amounting to 2,000 IDR per liter.

The House of Representatives (DPR) Commission VII earlier asked the government to study the possibility of fuel oil price hikes as one of the options to limit the use of subsidized fuels. The government appointed a consortium consisting of the Bandung Institute of Technology (ITB), University of Indonesia (UI) and Padjadjaran University (Unpad), along with the Oil and Gas Institute of the Energy and Mineral Resources Ministry, to conduct the study. The result of the study is expected to be ready this week. The government plans to discuss it with the House Commission VII at the end of February. 

Ikuti Whatsapp Channel Republika