Import of diesel by road ruled out

Published November 27, 2004

ISLAMABAD, Nov 26: Pakistan will not import diesel from India through land route in the foreseeable future but will see if sea route is feasible for the delivery of Indian diesel at the Port Qasim.

This has been conveyed to the Indian authorities during the recent visit of Prime Minister Shaukat Aziz to New Delhi, a senior petroleum ministry official told Dawn.

The ministry of foreign affairs and security agencies have also advised the government to adopt a coordinated policy on import of petroleum products, keeping in view diplomatic, political and economic implications for overall progress of India-Pakistan relations, sources said.

Explaining the reason for not using the land route, the official said the federal government had given a throughput guarantee of 4.5 million tonnes per annum for the $780 million White Oil Pipeline Project (WOPP) from Port Qasim to Multan.

In case, high speed diesel is imported through land route, then the government will have to pay throughput charge to the WOPP for its under-utilized capacity. In that event, any expected saving in transportation charges from Indian oil import through tankers or pipeline to Lahore would be neutralized.

However, Pakistan has already included high speed diesel and furnace oil in the list of items importable from India under the South Asia Preferential Trading Agreement (Sapta).

The chances of a bilateral meeting between petroleum ministers of India and Pakistan in the near future have diminished because of subdued discussions on diesel as well as gas pipeline project during the recent summit-level talks in New Delhi, the sources said.

Indian Oil Minister Man Shankar Aiyar had written to his counterpart Amanullah Khan Jadoon last month to import diesel from Gujarat and Haryana to Pakistan through land and sea routes by removing the product from the "negative list".