Mr. Irfan Iqbal Sheikh, President FPCCI, has apprised the Petroleum Minister Dr. Musaddik Malik that LPG is the fuel of masses and can play a decisive role in solving gas shortages in the country – provided the LPG Policy 2022 – 23 incorporates the feedback of the industry. He added that domestic, industrial and commercial consumers need a new LPG policy to reflect ground realities; as last LPG policy was announced way back in 2015.
It is pertinent to note that Dr. Mussadik Malik has visited Federation House and consulted a large gathering of local LPG producers and commercial & industrial users of gas.
The high-profile, well-attended session also saw participation of industrialists from across Pakistan over Zoom.
Mr. Irfan Iqbal Sheikh demanded that importers and domestic producers of LPG should be treated at par. Under the current practice, OGRA only takes into account indigenous LPG for price setting; which, as a matter of fact, accounts for less than 50% of total LPG consumed in Pakistan.
Additionally, sale of locally-produced LPG among marketing companies should be allowed as well, as it is allowed in the case of imported LPG.
Mr. Irfan Iqbal Sheikh expressed his trepidations that domestic producers of LPG are being subjected to 17 sales tax; while importers pay only 10 percent. Additionally, local producers are also paying petroleum development levy (PDL) and importers are exempted from PDL as well. The government must ensure level-playing field & encourage fair competition in LPG sector, he added.
Mr. Irfan Iqbal Sheikh reiterated that Pakistan has had a historic trade deficit of $48.66 billion in the fiscal year 2021 – 22 & current account deficit (CAD) clocked at $17.6 billion; and, in September 2022 alone, on a month-on-month basis, exports contracted by 3.8% to $2.4 billion; which is $95 million less than September 2021. This phenomenon shows that our exports are declining instead of registering aggressive growth to curtail trade deficit and current account deficit (CAD) – which should not be more than $10 – 12 billion this year as we don’t have fiscal space to manage anything more than that and we have made commitments to IMF, World Bank, ADB and other international financial institutions to limit our CAD in the proximity of $10 billion.