Govt Has Valid Reasons For Not Implementing Diesel Subsidy In Sabah, Sarawak

Prime Minister Anwar Ibrahim stated in June of this year that Sabah and Sarawak were exempt from the recent rationalization of diesel subsidies due to their heavy reliance on the fuel, which made the reduction of subsidies unfeasible in comparison to Peninsular Malaysia, where diesel usage is less widespread.
The government allegedly received a writ of summons regarding the diesel subsidy exemption in Sarawak recently. According to Domestic Trade and Cost of Living (KPDN) Minister Datuk Armizan Mohd Ali, the government  however has no intention of changing its stance on excluding those two countries from the implementation of the targeted diesel subsidy.

Armizan emphasized that there are specific, legitimate reasons why the targeted diesel subsidy has not been implemented in Sabah, Sarawak, and Labuan—not because of unfair treatment or double standards, Bernama has reported.

He clarified that a pilot implementation in Peninsular Malaysia was initially necessary due to the challenge of profiling to guarantee that aid reaches those who are truly in need.

He pointed out that the second reason has to do with Borneo's geography and logistics, where people are forced to use diesel-powered cars due to the region's topography rather than choice.

The third factor, he added, is the persistent and substantial price difference between Peninsular Malaysia and Sabah, Sarawak, and Labuan for goods.
"Recently, I presented a note to the Cabinet regarding monitoring conducted by our price observation officers. Over three months in July, August, and September we collected data on 480 items.

"We then compared the prices and found that 65 to 68 percent of these goods were significantly more expensive in Sabah and Sarawak than in Peninsular Malaysia," he said.

For the record, on June 10 of this year, Peninsular Malaysia implemented diesel subsidy rationalization, which resulted in a rise in the retail price of diesel fuel to RM3.35 per litre. This is in contrast to the current subsidised price of RM2.15 per litre, which has been in place nationwide since February 2021 and is still applicable in East Malaysia.