ISLAMABAD/LAHORE: After a daylong successful show of power, the Pakistan Petroleum Dealers Association (PPDA) on Thursday night called off its nationwide strike when the government agreed to increase their profit margin by 99 paisa per litre.

A spokesman for the association Jahanzaib Malik confirmed to Dawn that the government and PPDA chairman Abdul Sami Khan had reached an agreement after holding day-long negotiations in Islamabad.

Adviser to the Prime Minister on Finance Shaukat Tarin and Energy Secretary Arshad Mahmood held talks with the representatives of the PPDA as more than 80 per cent of the petrol pumps in all major cities, including the four provincial capitals, remained closed, causing great inconvenience to the general public.

Mr Malik said they were charging Rs3.91 per litre earlier and now their commission would be Rs4.90 and it would be increased after the government’s announcement of new prices next month. He said the dealers were demanding a 6pc increase in the selling price of petroleum products and the government had agreed to take it up to 4.4pc.

Over 80pc pumps in all major cities remained closed causing hardship to people

Later, the Petroleum Division of the Ministry of Energy issued a handout stating that “all stakeholders appreciated the Petroleum Division’s proposal for enhancement of 99 paisa in the existing margin of petrol i.e. Rs3.91/litre and 83 paisa in the existing margin of high speed diesel i.e. Rs3.30/litre”.

“The proposal for 25pc increase in the margin of dealers will cover all delays in the revision of margin in the past and would also help dealers in mitigating the impact of inflation,” it said, adding the Petroleum Division had assured that it would put all its endeavours to defend the proposal of 25pc increase in the existing margin before the Economic Coordination Committee (ECC) and the federal cabinet “so that this historic relief to the petroleum dealers in the shape of sizeable enhancement in their margins becomes a reality”.

It said all the parties clearly understood that passing on the extra costs to the general public and consumers of petroleum products was not viable. “However, the Petroleum Division assured the dealers’ association that after six months (during June 2022) margins will be readjusted according to the level of inflation prevalent at the time,” it added.

The dealers’ association suggested that in the subsequent adjustment, the margins might be fixed in percentage terms and the Petroleum Division would put its best efforts to obtain approval from the competent forum for revision of dealers’ margin up to 4.4pc of the selling price, excluding dealers’ margin.

“While agreeing with the proposal of dealers’ association in principle, the division will make best efforts to get it approved through the competent forum. This arrangement of enhancing margin presently by 25pc and subsequent readjustment after six months will ensure safety and security of the business of the dealers without passing the extra burden to the general public,” said the handout.

Earlier in the day, most of the petrol pumps remained closed on the strike call of the petroleum dealers. Despite the fact that the PPDA had given the call for the strike almost a week ago, the government came into action and began talks with the representatives of the dealers only after the PPDA started implementation of its announcement regarding closure of petrol pumps from Thursday morning.

There were reports that more than 80pc of the petrol pumps in major cities remained closed by Thursday night and long queues of vehicles were seen at few petrol stations which remained open in major cities.

Some of the companies, including Pakistan State Oil, Shell and Hascol, had announced that all their company-owned petrol stations would remain in operation, but most of the petrol pumps of these companies were also found closed by the evening as many of them ran out of stock due to unusual rush of vehicles.

The PPDA had announced continuing the strike till the acceptance of their demand after Minister for Energy Hammad Azhar declared that the government could not increase the prices of petroleum products “to facilitate a few groups, who wanted to get the rates raised by Rs9 per litre in the guise of strike”. He had made it clear that the government would not bow before these groups, saying only justified demands would be accepted.

The opposition parties lashed out at the government over its handling of the whole issue as Pakistan Muslim League-Nawaz (PML-N) president and Opposition Leader Shehbaz Sharif said the poor Pakistanis were getting closer to death because of this government “while Imran Niazi’s cruelty and apathy were rubbing salt into the wounds of these impoverished people”.

“Every single crisis in the country from flour to sugar to petrol and gas is a product of Imran’s corruption, incompetence and mismanagement.”

Pakistan Peoples Party Chairman Bilawal Bhutto Zardari in his statement stated that the entire nation was forced, time and again, to bear the brunt of the “selected government’s incompetence”. He said the PTI government through its incompetence had always turned every solvable issue into a painful crisis.

Aamir Shafaat Khan in Karachi also contributed to this report

Published in Dawn, November 26th, 2021