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Indonesians protest against fuel price hike

27 March 2012 17:50 (UTC +04:00)

Baku-APA. Indonesian protesters took to the street on Tuesday, demanding the government to scrap the plan to increase subsidized fuel price on April 1, APA reports quoting Xinhua.

In the capital Jakarta hundreds of protesters staged rallies outside the parliament building and presidential palace.

The protesters failed to break into the parliament compound encircled with barbed wire and police, but they shouted their demands for the parliament members to disapprove the government plan.

In front of the presidential palace, protesters said President Susilo Bambang Yudhoyono broke his promise during the presidential election campaign.

At least 22,000 police and soldiers were deployed to prevent vital locations in the capital from being stormed by demonstrators.

Similar protests were also held in other large cities, including Medan in North Sumatra, Bandung in West Java, Yogyakarta, Surakarta in central Java and Surabaya in East Java.

Protesters gathered outside regional parliament buildings to convey their opposition to the government’s plan. Some protesters scuffled with police.

In Medan protesters blocked the airport’s gate. In Surakarta, deputy major of the city joined protesters in calling for the government to cancel the fuel price hike plan.

The parliament is scheduled to vote on the government’s plan on Thursday.

Government planned to raise subsidized fuel price to 6,000 rupiah per liter (about 0.6 U.S. dollars) from the existing 4,500 rupiah to cope with rise in global oil prices and reduce the huge burden of energy subsidy on state budget.

President Yudhoyono has gained support from majority of coalition partners including Democrat Party, National Mandate Party (PAN), National Awakening Party (PKB), United Development Party (PPP) and Golkar Party.

Justice and Prosperous Party (PKS) who joined the coalition opted not to support the government’s policy. "If the option (to raise the fuel price) would hamper the people, PKS opts to stand by the people," PKS Chairman Luthfi Hasan Ishaaq said on Tuesday.

As a net oil importing country which provides huge fuel subsidy, rising global oil price has hit the state budget hard as the proportion of budget deficit may widen to 2.2 percent of GDP from the initial target of 1.5 percent this year if the government does not raise fuel prices.

The compensation in the form of cash disbursement to the poor people is expected to ease the decline in their purchasing power.

The price hike is predicted to speed up inflation rate to 6.8 percent this year, Central Bank Governor Darmin Nasution said on March 8, overshooting the government target of 5.3 percent.

The protesters argued that there are many other options for the government to address the rising energy subsidy rather than increasing oil prices which they say would lead to rising food and other products prices.

The protesters said that the government should improve efficiency so that it could safe much more funds to cut the state budget deficit rather than oil price hike.