Pak to review diesel imports ban

Shaukat Aziz says new exim policy to incorporate changes

Pakistan will review a ban on import of diesel and petrochemicals from India when it next prepares the draft of the import-export policy, India's Petroleum Minister Mani Shankar Aiyar said today.

"Pakistan Prime Minister Shaukat Aziz has promised that the policy on import of diesel and 'LAB' from India will be reviewed when their policy comes up for review next," he told reporters.

Aiyar could not take up the matter with Pakistan's commerce minister, who was not in the city, and nor was he able to say when Pakistan would review its import-export policy next.

"But I have asked our Petroleum Secretary SC Tripathi to meet Pakistan's commerce secretary and put in a formal request for taking diesel and 'LAB' out of the negative list of importable items from India," said Aiyar, who is leading an Indian delegation to sort out modalities for the tri-nation Iran-Pakistan-India gas pipeline project.

Indian Oil Corporation (IOC) has offered to export 325,000 tonnes of diesel through the Karachi port and the Wagah border to Lahore and Jhelum, respectively, during October 2005 to March 2006.

Aiyar said the delay on the Pakistani side to lift the ban on diesel and "LAB" imports from India had been a boon as by the time the policy was reviewed, IOC's Panipat refinery expansion would be completed, increasing availability of exportable fuel.

Besides, the Panipat petrochemical complex will be up and running by October 2005.

Officials said IOC had also submitted a non-binding indicative offer to Pakistan State Oil (PSO) company for export of 2.5 million tonnes of diesel from next year at prices ranging from $3.75 to $6.15 per barrel (depending on location).

PSO, too, had expressed the desire to import diesel on a delivered basis at the Chiktirana Depot (near Jhelum city) "" 300,000 tonnes a year by tank wagons; Machikey Depot (near Lahore city) "" 1.2 million tonnes a year by tank trucks; and the FOTCO, Port Qasim, Karachi "" 1.0 million tonnes a year by tankers.

Pakistan's petroleum product requirement is around 14 million tonnes per annum and it imports more than 4 million tonnes of diesel.

The Lahore region alone requires about 3 million tonnes and the deficit in this region is met from Karachi, either through imports or from refineries in the port city.

Pakistan, which imports 4-5 million tonnes of diesel from Kuwait per annum, does not have any refinery in the Lahore-Multan area. It had, in fact, sought price quotations from IOC for import of diesel at Lahore, Jhelum and Karachi.

IOC has proposed to supply 100,000 tonnes from Jamnagar to Karachi through the sea route and the remaining 225,000 tonnes through land route.

Aiyar said IOC was also looking at exporting petrochemical products "" linear alkyl benzene, purified terephthalic acid and polymers "" to Pakistan.