Karachi, November 16, 2024 – The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has voiced strong objections to the recent amendments made to the Petroleum Act of 1934. The amendments, introduced on August 5, 2023, particularly Clauses A, B, and C, categorize certain petrochemicals, but have raised significant concerns among chemical importers, traders, and industrialists.
FPCCI President Atif Ikram Sheikh highlighted that the amendments have caused confusion and led to numerous complaints from the chemical sector. He explained that the Director General of Explosives, Abdul Ali Khan, recently visited FPCCI’s head office to engage with representatives from various sectors, including chemical importers, traders, and industrial bodies. During the meeting, concerns were raised about the categorization of petrochemicals, particularly in relation to industrial chemicals which are not necessarily flammable or hazardous like petroleum products.
Sheikh emphasized that thousands of industrial chemicals are used globally as raw materials in various industries and should not be treated the same as inflammable substances. He pointed out that the new regulations pose additional challenges for small and medium-sized enterprises (SMEs) due to their limited infrastructure and smaller scale of operations.
SVP of FPCCI, Mr. Saquib Fayyaz Magoon, echoed these concerns, stating that the complex conditions tied to the licensing, storage, and transportation of petrochemicals are causing disruptions in the availability of essential industrial chemicals. He warned that this could have a detrimental impact on industrial production and the nation’s export activities.
In response to the ongoing issues, FPCCI has called for the suspension or withdrawal of Clauses B and C introduced last year. The organization stresses that these amendments are counterproductive to the ease of doing business, particularly for industries such as textiles, which rely on uninterrupted access to raw materials.
Magoon also expressed appreciation for the willingness of the Explosives Department to grant exemptions on a case-by-case basis, based on FPCCI’s recommendations. This gesture is expected to help resolve some of the immediate concerns of the chemical sector.
Abdul Ali Khan, the Director General of Explosives, acknowledged the complaints and assured that his department would facilitate chemical traders within the scope of permissible regulations. He emphasized that his department is primarily concerned with chemicals containing hydrocarbons and encouraged traders to raise their concerns through FPCCI. Khan further assured that necessary approvals and exemptions could be obtained with FPCCI’s backing, and advised the chamber to send direct communications for faster resolution.
The debate surrounding the amendments to the Petroleum Act 1934 continues, as industry stakeholders push for reforms to ensure smoother operations for chemical importers and industrialists.
