BPC's New System

New system inside BPC May make NBR's task easy.

Bangladesh Petroleum Corporation (BPC) intends to launch a smart fuel distribution system. Successful implementation of this system means timely distribution of fuel and greater transparency in fuel transaction. Being the largest corporation of Bangladesh, BPC activities mean a lot to the govt. (For more read "Smart Fuel Distribution Chalu Korte Chai BPC(BPC Wants To Start Smart Fuel Distribution)", Sanchita Shitu,Bangla Tribune,May 23,2024.Link:https://tinyurl.com/shjbnct4)

Since 2015,BPC made huge profits and it continued till 2021.In this period, govt provided zero subsidy to BPC.Prior to 2015,huge subsidy was given to BPC. In 2013,govt gave a subsidy of Taka 13.557 billion to BPC. This unravels the subsidy pressure on govt. Luckily, monthly fuel price adjustment eases the pressure a lot. But is it enough to rescue the BPC?

BPC automation software has long been a topic of debate. Few years ago, a report divulged that BPC developed a software but faced overwhelming odds implementing the software as certain quarter delayed its implementation(For more read "BPC's 'Payment Automation' Launch Hits Snag" by Financial Express,June 24,2019.Link:https://thefinancialexpress.com.bd/trade/bpcs-payment-automation-launch-hits-snag-1561348071). Prior to the development of software, it took as long as 10 months to record a BPC transaction. That means BPC's legitimate transaction went out of official record from 10 months, ample time to make some fortune out of BPC money. Could anyone believe in a public corporation this kind of mockery was going on years after years?

BPC's transaction revenue is also a great deal of concern for the NBR. It gets huge amount of revenue from BPC's fuel sale. Real time transaction data means real time data on VAT. Lack of real time data allows other to keep NBR in the dark. Another news report divulged that Petrobangla earned huge interest by keeping money into several bank accounts while it owes Taka 220 billion to NBR. I touched the issues in my January piece titled "Economic Reforms: Morning Shows The Day"(for more read https://hoquestake.blogspot.com/2024/01/economic-reforms-morning-shows-day.html?m=1). Both BPC and Petrobangla are large sources of VAT for NBR. Dedicated offices in these two corporations and real time data on VAT could provide relief to NBR in this time of meeting the revenue target.

Not only the BPC money but sometimes subsidized oil also goes off the radar. Two years ago a deadly fire accident in an internal container depot in Chattogram revealed that oil smuggled out of the country in disguise of other goods inside containers. BPC 's smart fuel distribution system hopefully curb the incidence of such practice. It is not clear whether the smart fuel distribution system is the same software automation or a completely new system. If it is the same thing then why does it take so long to implement it? If it is a new system then it will add another layer of security to the existing software automation of BPC and ensure that subsidized oil will not fall into wrong hands.