'Less than 20% hike won't affect land transport'
'Less than 20% hike won't affect land transport'
Rendi A. Witular, The Jakarta Post/Jakarta
The Ministry of Transportation has assured the public that there
will not be any increase in tariffs for inter-city land transport
if the government does not increase fuel prices by more than 20
percent.
"Inter-city land transport tariffs will not increase following
the fuel price hike, if it is less than 20 percent," minister
Hatta Radjasa told a press conference on Friday.
He explained that land transport has a floor price set at Rp
60,000 (US$6.50) per 100 kilometers per passenger, and a ceiling
price of Rp 90,000 per 100 km per passenger.
Speaking on city transportation tariffs, Hatta said that such
decisions would be made by respective local administrations.
The announcement is deemed necessary because public transport
users will be the ones most affected by the planned fuel price
hike, which is slated to be announced before April 1 according to
Coordinating Minister of the Economy Aburizal Bakrie.
Hatta also said that his ministry would also make decisions on
any increases in water transport passenger tariffs.
But State Minister of National Development Planning Sri
Mulyani Indrawati said later that the fuel price hike would lead
to a rise in all tariffs for transport by between 15 percent and
20 percent.
She also said that fuel prices would in all likelihood be
raised by 30 percent on average.
The National Development Planning Board, of which Mulyani is
the chairwoman, is responsible for studying options to reduce the
government's oil subsidy burden, including calculating fuel price
hikes.
The government has already raised the retail price of high
quality gasoline brands Pertamax and Pertamax Plus to Rp 4,000
per liter and Rp 4,200 per liter, or by 63.3 percent and 52.7
percent, respectively, on Dec. 19.
Surging global oil prices cost the government Rp 62.8 trillion
in fuel subsidies last year.
Increases in fuel prices will eventually cause prices of other
commodities to increase.