pakistan

Fuel shortages loom amid Pakistan’s economic woes

Published

1 year ago

January 31, 2023

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Fuel shortages loom amid Pakistan's economic woes

Pakistan could face a crunch in fuel supplies in February as banks have stopped financing and facilitating payments for imports due to depleting foreign exchange reserves, traders and industry sources said.

The country is facing a balance of payments crisis and the plummeting value of the rupee is pushing up the price of imported goods. Energy comprises a large chunk of the import bill.

Pakistan typically meets more than a third of its annual power demand using imported natural gas, prices for which shot up following Russia’s invasion of Ukraine.

“There is no shortage this fortnight. If we don’t have LCs (letters of credit) open right now, we might see shortages in the next fortnight,” a senior official at one of the oil companies told Reuters.
A letter of credit issued by the importer’s banks is a standard form of payment guarantee in the oil trade to the exporter.

Oil traders, however, are shunning countries such as Pakistan and Sri Lanka due to an acute shortfall of foreign exchange. Pakistan on Sunday raised petrol and diesel prices by 16 per cent to Rs249.80 a litre and is in talks with the International Monetary Fund to unlock a suspended bailout package.

State-owned refiner Pakistan State Oil (PSO) and Pakistan LNG Ltd have left a flurry of fuel tenders unawarded in the last couple of months.

At an industry meeting on financial challenges faced by fuel importers, State Bank of Pakistan officials cited “severe liquidity issues” faced by the country for delays in the opening of LCs, according to a Jan 19 letter from Imran Ahmed, director general of oil, reviewed by Reuters.

At the same meeting, the managing director of PSO said a gasoline cargo due for loading on Jan 13 has already been cancelled due to the non-opening of LCs. “He added that the country is having limited stocks and such a situation can lead to dry out,” according to the letter.

Previously, the Oil Companies Advisory Council (OCAC), representing refining, pipeline, and marketing companies, also flagged that delays in the opening of LCs could “lead to a fuel shortage in the country”.

In a Jan 13 letter to the Ministry of Finance, OCAC said Pakistan needs to import around 430,000 tonnes of gasoline, 200,000 tonnes of diesel, and 650,000 tonnes of crude oil every month, costing $1.3 billion to meet local demand.

“If LCs are not established on a timely basis, critical imports of petroleum products would be impacted which may lead to a fuel shortage in the country,” the OCAC said.

Pakistan bought only 223,000 tonnes of gasoline in December versus 608,000 tonnes in the same period a year earlier, data from Kpler showed. In January this year, the country was projected to import 270,000 tonnes of the fuel, compared with 393,000 tonnes in the same month in 2022, the data showed.

Some banks have denied delays in issues of LCs, while SBP did not respond to a Reuters email seeking comment.

“If there are no issues with LCs in Pakistan then why have the SBP and sector been holding meetings all of last week?” a senior official from one of the oil companies said.

PSO said last week it was ensuring a seamless supply of gasoline and oil across the country and had ample stocks.

It also said its import cargoes were arriving smoothly as planned.

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Former PM Raja Parvez Ashraf raises concerns over IMF bailout conditions

Published

9 hours ago

May 3, 2024

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Former PM Raja Parvez Ashraf raises concerns over IMF bailout conditions

Former prime minister Raja Parvez Ashraf has raised concerns about the potential conditions of the new IMF bailout package for Pakistan.

In a statement issued on Friday, the PPP Central Punjab President suggested that the government should brief parliament on the IMF package, with the finance minister providing lawmakers with details on new taxes and approved austerity measures during an in-camera session.

Ashraf underscored that instead of privatising Pakistan International Airlines (PIA) and other vital institutions, state-owned enterprises should be managed through public-private partnerships.

The former PM strongly opposed the idea of imposing taxes on pensioners, deeming it unacceptable. He urged the Finance Ministry to seek an alternative solution.

Raja Parvez Ashraf also highlighted the potential for enhanced harmony between the Centre and the provinces through the full implementation of the 18th Amendment.

He also proposed the abolition of unnecessary ministries to alleviate the financial burden on the federation.

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pakistan

Pakistan slams Indian atrocities against minorities, Kashmiris at UN

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9 hours ago

May 3, 2024

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Pakistan slams Indian atrocities against minorities, Kashmiris at UN

Pakistan addressed the UN General Assembly on Thursday, asserting that India was targeting Indian Muslims, Christians and Muslims in occupied Kashmir, and urged an end to their harsh suppression.

Ambassador Munir Akram stated during a debate on ‘Culture of Peace’ that since the BJP-RSS government took office in 2014, hate, oppression and violence against India’s 200 million Muslims, as well as other minorities like Christians and the ‘lower-caste’ Dalits, became rampant and systematic, driven by the ideology of Hindutva.

The envoy emphasised that unless Hindutva fascism was opposed and the impunity of the BJP-RSS ended, wider violence and conflict in South Asia would remain a real and present danger.

Despite efforts to promote a “Culture of Peace,” Akram noted a rise in hate, violence and war worldwide, with over 300 conflicts raging across the globe.

Highlighting Pakistan’s efforts to combat Islamophobia, Akram expressed deep concern at the officially sanctioned manifestations of Islamophobia in India, citing the Citizenship Law and National Registry list designed to exclude Muslims from citizenship.

The envoy warned of the spread of Hindutva extremism, which he said turbo-charged repression in occupied Jammu and Kashmir. He called for urgent resolution of the Kashmir dispute in accordance with UN resolutions and the wishes of the Kashmiri people.

Akram also highlighted India’s belligerence towards Pakistan, citing threats from Indian officials to “take over” Azad Kashmir and dangerous military doctrines adopted by India.

He accused India of financing and sponsoring terrorist groups to disrupt the China-Pakistan Economic Corridor (CPEC), and highlighted Pakistan’s concerns over India’s campaign of targeted assassinations, even beyond its borders.

Akram emphasised the urgent need for the international community to address these issues and reiterated Pakistan’s commitment to peace and stability in the region.

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pakistan

NA Secretariat accepts inclusion of independent members in SIC

Published

1 day ago

May 2, 2024

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NA Secretariat accepts inclusion of independent members in SIC

he National Assembly Secretariat has accepted the inclusion of independent members (PTI-backed MNAs) in the Sunni Ittehad Council (SIC), Dunya News reported.

The National Assembly Secretariat has released a list of 83 members of Sunni Ittehad Council on its official website after the approval of NA Speaker Ayaz Sadiq.

After the inclusion of independent members, Sunni Ittehad Council has become second largest party in the lower house of the parliament with 83 members.

The Election Commission of Pakistan (ECP) had sent a notification regarding the inclusion of independent members in the SIC to the National Assembly Secretariat.

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