India has shown interest in laying a dedicated oil pipeline for Pakistan upto Wagha border if an agreement is reached between the two countries, while Pakistan has proposed exporting naphtha for refining at the Indian oil refineries.
An official source said that these matters were discussed at the two days technical talks held between India and Pakistan on Monday to identify petroleum products for imports, their quantity and their payment mechanism. He said that the Indian side offered to meet all the petrol requirements of Pakistan that are currently met through imports from Gulf states.
The dialogue will provide opportunity for Indians to explore potential areas for trade with Pakistan. The two sides will identify products for trade, specifications, volumes, supply sources and transportation mechanism. Pakistan is interested in importing POL products, diesel and furnace oil from India as their price is 30 percent less than the Gulf market.
Pakistani delegation is led by Joint Secretary International and Joint Ventures Ministry of Petroleum Shabbir Ahmed and members include representatives of Ministry of Commerce, Ministry of Foreign Affairs, Ministry of Finance, OGRA, Federal Board of Revenue, Pakistan State Oil, PARCO and Attock Refinery Limited.
Indian delegation is headed by Director International Cooperation and Corporate Affairs, Ministry of Petroleum India P. Kalyanasundaram and comprises of business representatives from leading Indian companies including Petroleum Federation of India (PetroFed), IOCL, BPCL, HPCL, Reliance Industries, and Essar Oil Limited.
While talking to the Indian delegation, Petroleum Minister Dr. Asim Hussain said there is potential for trade of petroleum products between the two countries and initiation of talks would prove to be a step in the right direction. Pakistan, he said, is interested in the import of furnace oil and diesel from India. He also informed the delegation about the TAPI pipeline project.
Pakistan’s consumption of petroleum products is about 22 million tons, of which about 85 per cent is met through imports. The total diesel demand is estimated at 7 million tons per annum. The domestic supplies are of 3.4 million tons and the rest is imported. While the furnace oil demand has risen to 9 million tons, out of which only 2.5 million tons is produced locally. The government estimates increase in furnace oil consumption to 16 million tons by 2015-16.
it doesnt add up, why oil import from india is cheaper when India doesnt produce its own oil and also import and refine.
Pakistan is not land locked country and near by distance to source(Gulf) of oil imports compared to India.
Its like outsourcing refineries and jobs of Pakistan to India by importing refined oil instead of importing cheaper crude oil and refine at Pakistan refineries!
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