Petrol smuggling costing national exchequer Rs 240 billion loss annually

Petrol smuggling

Pakistan bore an annual loss of Rs 240 billion due to the petrol smuggling, the Petroleum Commission has made a report public on Tuesday after the approval of the federal cabinet.

According to this report, Pakistan is bearing an annual loss of Rs 240 billion due to the smuggling of petroleum products. Petroleum products like motor spirits and high-speed diesel are smuggled into the country from Iran.

During the year, 2019-20, the government seized 27,911,746 liters of petrol and 997,037,434 liters of diesel which was smuggled from the western border.

Read more: PM Imran orders crackdown against fuel smuggling across Iran border

The loss of the revenue on the smuggled petroleum product comes to around Rs 48 billion in one year as the government is collecting Rs 36.27 sales tax, petroleum levy, and customs duty on one-liter Motor Sprit and Rs 47.22 on Hugh Speed Diesel.

The report of the commission says that seized quantity of the petroleum product is only 20% of the actual smuggled amount. The report says that the smuggling is also done by sea. The Commission has alleged that a private refinery BYCO is involved in petrol smuggling. BYCO’s refinery is situated at a secluded place and there is hardly a check on its imports and what is smuggled.

The inquiry report of the commission says that this is possible as BYCO does not have a pier and berth at the refinery rather it uses the method of decanting ships, called Single Point Mooring (SPM).

In this method, a platform has been established about 18 kilometers in the open sea and the floating platform gets connected to the anchored ship in the open sea. The decanting is done through a submerged pipeline extended on the sea bed from the refinery to the floating platform. Two cases of smuggling by BYCO have also been mentioned in the report.

The report claimed that BYCO Refinery imported cheap Iranian crude oil with malafide intention through the fake and forged document. According to the report, the assessment of loss to the government treasury and economic loss through smuggling is difficult to assess. Their report recommends a deeper probe with respect to the suspected functioning of BYCO Refinery.

The report recommends that Pakistan Coast Guards assisted by Pakistan Customs have to play their effective role and be directed as such.

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