KUALA LUMPUR, July 23 — The Finance Ministry has concluded that at least 6.5 million litres of diesel were misappropriated by industries or smuggled into neighbouring countries daily before the targeted diesel subsidy was implemented.
Finance Minister II Datuk Seri Amir Hamzah Azizan said the rationalisation of diesel subsidy has resulted in a 23 per cent or 6.5 million litres reduction in daily sales at petrol stations in Peninsular Malaysia.
In early June, the average daily diesel sales was 28.6 million litres, which dropped to 22.2 million litres in early July 2024.
"This conclusion is supported by data showing that daily commercial diesel sales have increased by 4.8 million litres over the same comparison period.
"Given that the current price at petrol stations is RM3.35 per litre, industries that previously purchased subsidised diesel have now switched to commercial diesel," he said during the Dewan Negara sitting today.
Amir was responding to Senators Datuk Azhar Ahmad, Datuk Shamsuddin Abd Ghaffar, and Datuk Abdul Halim Suleiman's queries, as all three had inquired about the effectiveness of the Madani Subsidy Assistance or Budi Madani initiative following the diesel subsidy rationalisation.
He clarified that some petrol stations near the border in northern Peninsular Malaysia had experienced a drop in diesel sales of up to 40 to 50 per cent since the measure took effect.
"This situation reflects a decrease in smuggling activities to the neighbouring country due to reduced profit margins for smugglers," Amir said.
Meanwhile, the government provides a monthly RM200 cash aid for small farmers and smallholders whose annual sales fall between RM50,000 and RM300,000.
Eligible small farmers and smallholders registered with the GeoAgro portal of the Agriculture and Food Security Ministry and agencies under the Plantation and Commodities Ministry can apply for this assistance.
"Eligible small farmers and smallholders can also benefit from the Subsidised Diesel Vehicle Scheme or SKDS 2.0 for logistics vehicles to prevent raising transportation costs," he said.
— Bernama
