Fuel crisis feared in Pakistan as petroleum cargo stuck amid Sindh government tax dispute
KARACHI: A potential nationwide fuel shortage looms after a sudden move by the Sindh government to reinstate a 100% bank guarantee requirement under the Infrastructure Development Cess (IDC), causing petroleum cargo to be held up at ports. According to industry representatives, the Sindh government has reactivated the cess — originally imposed in 1994 — following…
KARACHI: A potential nationwide fuel shortage looms after a sudden move by the Sindh government to reinstate a 100% bank guarantee requirement under the Infrastructure Development Cess (IDC), causing petroleum cargo to be held up at ports.
According to industry representatives, the Sindh government has reactivated the cess — originally imposed in 1994 — following a Supreme Court ruling that upheld the province’s authority to levy the tax. The unexpected enforcement has left imported petroleum consignments stranded at Karachi’s ports, sparking fears of disruptions in fuel supply across the country.
Oil marketing companies have expressed concern over the measure, warning that delays in cargo clearance could result in shortages of petrol and diesel nationwide if the issue is not resolved swiftly.
Legal experts note that the IDC had been a longstanding point of contention between the Sindh government and petroleum companies. The companies had earlier challenged the cess in the Sindh High Court and later in the Supreme Court, which ultimately ruled in favour of the provincial government.
Economic analysts warn that any prolonged standoff could have ripple effects on transportation and industrial operations, particularly amid already high inflation and energy costs.
