Kyrgyzstan Proposes Raising Fuel Import Subsidies to 30 Percent

The Cabinet of Ministers in Kyrgyzstan has put forward a proposal to amend the rules governing state subsidies for petroleum product importers. This initiative seeks to mitigate rising fuel prices and avert potential shortages within the domestic market. The draft resolution is currently open for public discussion. Current regulations primarily offer subsidies for fuel delivered by rail. The proposed changes would extend this support to petroleum products entering Kyrgyzstan from third countries through its state borders via various modes of transport, thereby diversifying supply channels. The proposal specifically identifies potential fuel imports from China, Iran, Turkmenistan, Azerbaijan, Georgia, and Turkey. Additionally, the government suggests updating the estimated purchase costs for petroleum products, setting them at $1,100 per ton for AI 92 gasoline, $1,200 for diesel fuel, and $700 for liquefied petroleum gas. AI 95 gasoline would be removed from the list of subsidized fuels. When calculating subsidies, authorities would consider not only the fuel's purchase price but also its transportation costs to Kyrgyzstan. The maximum subsidy rate would increase from the current 20 percent to 30 percent. Concurrently, importers will face more stringent requirements, needing to provide contracts, invoices, and transport cost documentation. The State Customs Service will be authorized to process and verify subsidy applications for fuel imported from third countries.