ISLAMABAD, June 13: Pakistan saved $566 million over last year’s oil spending as petroleum imports dropped by 20 per cent during the first ten months (July-April) of the current fiscal.

According to Economic Survey 2001-02, total imports during the first ten months of the current fiscal declined by 6.9 per cent to $8.245 billion as against $8.859 billion of the last year. Major decline in imports during July-April have been observed in food and petroleum groups.

“Imports of petroleum group declined by 20 per cent. This decline was mainly caused by 16.8 per cent drop in the prices of petroleum products and 15.1 per cent fall in crude petroleum. Consequently, the share of POL in total imports has declined from 31.4 per cent to 27 per cent,” notes the survey.

This 15.1 per cent decline in crude oil import clearly showed that this had a negative impact on the industrial sector as low POL consumption was indicative of slower industrial activity and productivity. Total oil imports this year amounted to $2.222 billion against $2.779 billion of July-April last year period.

While imports of machinery dropped by 2.7 per cent, again confirming that the manufacturing sector remained stagnant, imports of textile machinery and construction plus mining increased by 11.8 per cent and 61.6 per cent.

From another view, although the overall imports have declined by 6.9 per cent, the non-food and non-oil imports have increased by 2.5 per cent during first ten months of the current fiscal.

Continued volatility of oil prices has remained a cause of concern for Pakistan in the second half of the current fiscal. This sector has historically kept Pakistan’s balance of payment position under constant pressure. While oil import bill used to be on an average 17 per cent of total imports, it increased to 31 per cent last year before dropping again to 27 per cent this year.

The finance minister said that events of September 11 have also disrupted the shipping and cargo services, raised marine freight rates and witnessed imposition of war risk insurance but final outcome was not that bad as feared.

Exports were targeted at $10.1 billion for the year, around 8.7 per cent higher than last year. The finance minister, however, hoped that $9 billion mark in exports could be achieved by the year-end.

Exports during 10 months stood at $7.329 billion which were # 1.8 per cent lower than $7.456 billion recorded last year. All the major categories of exports except for textile manufactures registered decline.

The major decline was observed in the exports of primary commodities, down by 19.5 per cent, including rice 18 per cent and raw cotton 87.9 per cent. The exports of carpets declined by 15.5 per cent, leather manufactures by 9.6 per cent and chemical and pharmaceutical products by 16.4 per cent.

During the first three quarters of the current fiscal, the household, industry, agriculture and transport sectors showed declines in oil consumption of 25.1 per cent, 16.7 per cent, 6.7 per cent and 4 per cent respectively due to decline in the use of kerosene, furnace oil, light diesel oil and conversion of vehicles to CNG.

However, other sectors have recorded increasing trend mainly due to higher demand of JP-4 by defence. September 11, 2001 events have also caused lower consumption of petroleum products as a number of foreign airlines suspended or curtailed their operations in Pakistan.

During July-March 2001-02, the production of crude oil per day has increased to 64,361 barrels from 57,048 barrel per day (BPD) showing an increase of 12.8 per cent.

The production of gas per day stood at 2,521 million cubic feet as compared to 2,375 million cubic feet showing an increase of 6.1 per cent.

The installed capacity of electricity has increased by 1.6 per cent during first nine months of the current fiscal year and stood at 18,062 mega watt. Electricity produced during the period stood at 54,274 Gwh against 49,682 Gwh same period last year.

More than 850 licences for installation of CNG stations have been issued. So far 242 such stations have been established in different parts of the country.

Up to March 2002, around 240,000 vehicles have been converted to CNG. The target for conversion of vehicles to CNG is 300,000 vehicles up to 2003.