ISLAMABAD: In a major drive against oil smuggling, Prime Minister Imran Khan has approved a comprehensive action plan against 2,094 illegal petrol retail outlets in three provinces and halt smuggling of petroleum products at the border stations in Balochistan.

In a presentation, the customs officials in­­formed the premier that the estimated loss, due to the illegal selling of petroleum products to the national exchequer, is in the range of Rs100 billion to Rs150bn per annum. The Customs Department at the Federal Board of Revenue will be the lead agency in the operations.

The action plan includes a crackdown against illegal petroleum outlets in Punjab, Khyber Pakhtunkhwa, and Sindh. An FIR will be lodged against the owner and proceedings for forfeiture of oil station and other properties of the owner in favor of the federal government will be initiated.

However, action against illegal petroleum outlets in Balochistan will be taken afterward. The petroleum ministry will also explore with the Ministry of Foreign Affairs the possibility of legal import of oil, high-speed diesel from Iran to bring an end to smuggling.

As per the estimates, the highest numbers of illegal petroleum retail outlets are in Punjab province at 1,317, followed by 343 in Khyber Pakhtunkhwa, 336 in Sindh and 98 in Islamabad Capital Territory and Rawalpindi division.

Karachi has 68 illegal petroleum outlets selling smuggled petrol, followed by 55 in Peshawar. However, no illegal petroleum outlet is reported in Lahore.

Illegal sales causing Rs150bn annual losses to national kitty

An official source told Dawn that in some cases, the petroleum outlets especially in Sindh are owned by bureaucrats. The provincial chief secretaries and inspectors general police are also directed to share the actual number of illegal petroleum outlets with the Customs Department.

Balochistan is spotted as one of the major supply routes of smuggled petroleum products to these outlets for selling to end consumers, added the official.

The operation will be monitored from the Central Control Room resourced by Pakistan Customs, situated in the Ministry of Interior and Provincial Control Rooms in the offices of Chief Secretaries of respective provinces. The BS-19 Officers from customs, district management, police, and other agencies will be appointed as focal persons at Provincial Control Rooms for close coordination.

According to the action plan available with Dawn, operation against illegal outlets has been divided into two phases. The initial phase will comprise simultaneous action against illegal POL retail outlets in three provinces -- Punjab, Sindh, and KP which have already been geo mapped by customs and choking off supply routes of smuggled POL products from Balochistan to the rest of the country.

The second phase will encompass mapping of requirements of POL products in Balochistan, planning for provision of legal retail outlets to replace the shortfall of smuggled oil and devising a strategy to curb POL smuggling at the international border of Balochistan.

Pakistan Customs will be the lead agency in conducting this operation, supported by all concerned ministries, divisions, provincial governments and other governmental organisations.

A well-defined SOPs formulated by customs will be followed by a uniform and effective operation in all three provinces. The enforcement teams comprising officers from customs, district management, police, Rangers, and I will jointly conduct the operation on all illegal retail outlets.

If the owner or manager of a petrol station fails to present oil marketing company authorisation and CIE’s License on Form-K of the Department of Explosives, the retail store will be considered ‘illegal’. A detailed inventory of the POL products present in the illegal outlet shall be made; storage tanks and nozzles of dispensers will be sealed by customs and district administration jointly and shall be secured by police.

The customs will serve the required notices under the Customs Act, 1969 to the owner or manager of illegal petrol stations. In case, no documents are produced by the owner within seven days, FIR will be lodged against the owner and proceedings for forfeiture of oil station and other properties of the owner in favor of the government as per provisions of Customs Act, 1969 will be initiated.

All major supply routes used for POL smuggling from Balochistan to the rest of the country will be monitored and choked through strengthening of check posts manned by customs and assisted by FC, police/levies and representatives of ISI at critical locations like Gaddani- Cross, outside Khuzdar on M-8, Kolpur, Rakhni, Manikhawa, and Darya Khan Bridge. All tankers of PSO and other OMCs operating in Balochistan will be fitted with trackers to provide real-time data and alerts.

After the completion of activities under phase one, a detailed phase two will be launched to perform important tasks like need assessment of POL products in Balochistan so that a roadmap may be formulated to fulfill their requirement.

The option of legalising import of POL products from Iran through land route will be considered by the Ministry of Foreign Affairs, Ministry of Petroleum and Ministry of Commerce will also be explored followed by the closure of entry points at Pak-Iran border in Balochistan --- Paroom, Panjgur, Basima, Hoshab, Ormara, Dasht (Mastung) predominantly used for smuggling POL consignments, thus choking the main supply routes on the international border.

The establishment of new legal POL outlets by OMCs in all districts of Balochistan will resolve the matter in the long run. After completing the task, an effective operation against illegal POL outlets in Balochistan will be launched on a date to be decided by the government.

Published in Dawn, January 3rd, 2021