ISLAMABAD: State-run Pakistan State Oil (PSO) has confirmed that one of its petrol cargos in October 2020 was imported under the China-Pakistan Free Trade Agreement (CPFTA) but the origin of cargo was not known to it when it awarded the tender.

“In October 2020, a cargo was imported which incidentally came under the CPFTA arrangement,” said the PSO in response to a Dawn report on Tuesday, adding that “at the time of award of tender, the loading or origin of cargo was not known to PSO.”

During FY2021 PSO imported more than 50 cargoes of petrol and only one cargo happened to come under the CPFTA arrangement, it added.

The company, however, explained that the benefit of duty waiver was passed on to the end consumer by the Oil & Gas Regulatory Authority (Ogra). It said that under the procurement rules, “PSO cannot mention or specify the point of origin of import at any point in time during the procurement process”.

The state run fuel supplier said it ‘did not realise any windfall benefit due to custom duty waiver on petrol imports from China’ but stood passed on to the end consumer by the company. “This is because as per government policy, the price of petrol for a particular month/fortnight is based on average of Platts’ publications and PSO’s actual import incidental costs and custom duty”.

The company explained that at that point of time when the said vessel was imported from china, the total duty applicable on petrol was five per cent (i.e 3pc Custom Duty and 2pc Additional Custom Duty). PSO only paid 2pc additional custom duty amounting Rs64,591,436, whereas as benefit of 3pc custom duty amounting Rs96,887,154 was passed on to the consumer.

Published in Dawn, January 27th, 2022