LPG crisis feared

LAHORE: LPG shortage is feared as its importers have threatened to suspend its import from the next month if the government did not withdraw regulatory duty and advance tax.

The government had imposed petroleum levy on locally produced LPG. Meanwhile, the government also imposed regulatory duty on LPG imports equal to petroleum levy on locally produced LPG which had resulted in widening price difference, making imports unfeasible.

Following directions of Prime Minister Shahid Khaqan Abbasi, the officials of Petroleum Division held a meeting with LPG importers to address their concerns. During the meeting, it was said the imposition of regulatory duty on imported LPG was against the spirit of LPG Policy approved by the present government to bridge price difference between local and imported LPG.

It was said the purpose of imposition of petroleum levy on locally produced LPG was to bridge the price difference between local and imported LPG. But the government has also imposed regulatory duty on imported LPG at the same time which also led to widening gap between the prices of local and imported LPG, making the imports unfeasible.

The importers demanded withdrawal of regulatory duty on imported LPG and 5.5 percent advance tax for smooth supply of imported LPG to meet the local demand. At present, there is no advance tax on locally produced LPG. Talking to journalists after the meeting, All Pakistan LPG Distributors Association Chairman Irfan Khokhar, accompanied by LPG importers, said that imports of LPG would be suspended from February 1 if the government did not withdraw regulatory duty and advance tax on LPG imports. He said there was a price difference of Rs 15 per kg between local and imported LPG which had created monopoly of local LPG producers. In this way, he said, local producers were minting Rs 30 million daily from the consumers.

He said local LPG producers had created monopoly on LPG quota and there were 146 LPG marketing companies but only 30 companies had local LPG quota. He alleged Pak Arab Refinery (Parco) was involved in allocating LPG quota to its blue-eyed without inviting bids which was in violation of PPRA rules. He said that during the meeting, the officials of Petroleum Division had assured that an inquiry would conducted.

He said that importers would give presentation to the Petroleum Division regarding price difference with evidence. Local producers had also submitted a report. The Petroleum Division would send its report to the prime minister to find out the solution.