Karachi, July 12, 2023 – The Pakistan Petroleum Dealers Association (PPDA) has raised concerns over the detrimental effects of an influx of smuggled petroleum products on the sales of petrol pumps across the country.
The chairman of PPDA, Abdul Sami Khan, has appealed to Prime Minister Shehbaz Sharif, Finance Minister Ishaq Dar, and State Minister for Petroleum Dr. Musadik Malik to urgently address the situation by providing relief and revising the petroleum dealer’s margin.
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Pakistan Petroleum Dealers Association highlights negative impact on industry and economy
Chairman Abdul Sami Khan pointed out that the Consumer Price Index (CPI) has shown a staggering increase in inflation rates, reaching nearly 38 percent compared to previous years. He emphasized that utility costs, labor costs, financial costs due to high KIBOR rates, taxes, and regulatory expenses, including provincial requirements, have resulted in negative earnings due to non-practical margins.
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Highlighting the significant role of the petroleum industry as the backbone of the country, with a network of over 12,000 retail outlets serving civilians, the military, police, NGOs, utility companies, hospitals, banks, and construction machinery on a 24X7 basis, Khan expressed dismay at the government’s neglect of this vital sector.
“Adding to our hardships, the widespread availability of smuggled illegal petroleum products in the Pakistani market is not only harming the economy but also impacting registered petroleum dealers,” stated the PPDA chairman.
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Petroleum dealers, who have made substantial investments and complied with all relevant statutory requirements to sell duty-paid compliant products, are unable to compete with the selling price of smuggled petroleum products available on every street corner. Consequently, petrol pump sales have dropped by a staggering 40 percent, dealing another blow to the petroleum industry and the overall economy of Pakistan.
“With the situation becoming increasingly complex, we urgently seek a resolution to our grievances and request prompt action from the authorities to address our concerns and allow us to operate our businesses,” pleaded Abdul Sami Khan.
The PPDA chairman appealed to the relevant authorities to thoroughly investigate the matter and propose a pacifying solution. Failure to find a resolution could potentially lead to the closure of the industry, as the association sees no alternative but to cease operations.
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As the influx of smuggled petroleum products continues to harm legitimate businesses and the economy, the authorities are urged to take swift action to combat this issue and restore stability to the petroleum industry in Pakistan.
