Presented Recommendations on Behalf of Abdul Sami Khan.
Karachi (May 2, 2025): Federal Minister for Petroleum, Mr. Ali Pervaiz Malik, stated that resolving the issues
faced by petroleum dealers is among the government’s key priorities and that the issue of smuggling will remain a permanent part of the government’s agenda. He made these remarks during a meeting of the Standing Committee on Energy (Petroleum Division) while speaking with members of the Pakistan Petroleum Dealers Association (PPDA).
The meeting was chaired by Member National Assembly Syed Mustafa Mehmood. During his address, the Federal Minister discussed in detail several key issues related to the petroleum sector.
At the start of the meeting, on behalf of PPDA Chairman Mr. Abdul Sami Khan, Senior Vice Chairman Malik Khuda Baksh presented a bouquet to the Committee Chairman as a gesture of goodwill. He was accompanied by PPDA’s Vice Chairman Raja Waseem, and members Ch. Zafar Elahi and Faisal Arif.
Mr. Malik Khuda Baksh highlighted the critical challenges faced by petroleum dealers across the country and presented policy recommendations and concerns on behalf of Chairman Abdul Sami Khan.
On the matter of Deregulation of Petroleum Products, Mr. Khuda Baksh briefed the committee about a high-level meeting held at PSO House in Karachi, which was attended by former Petroleum Minister Musadik Malik, OGRA Chairman Masroor Khan, Director General (Oil), MD PSO, and a PPDA delegation led by Chairman Abdul Sami Khan. In that meeting, deregulation of the petroleum industry was discussed in detail, and assurances were given to Mr. Khan that no decision would be made without the consultation of the PPDA and its chairman.
Due to Mr. Abdul Sami Khan’s current illness, Mr. Khuda Baksh requested the Committee to defer the deregulation matter until the next session. He assured that PPDA would submit its written recommendations before the next meeting. The Committee agreed and instructed PPDA to submit its proposals in writing.
On Credit Card Charges Deducted by Banks, Mr. Khuda Baksh raised concerns over banks deducting 0.8% to 1% (approximately Rs. 2.10 per liter) from the Rs. 8.64 per liter earned by PPDA dealers. After accounting for this deduction, staff salaries, utility bills, local taxes, and other operating expenses, dealers are left with only about Rs. 3 per liter — an unsustainable amount.
He proposed two solutions to the Committee: 1. The State Bank should issue a circular to directly reduce bank charges.
2. Alternatively, dealers should be allowed to pass on card transaction charges to customers, following international practices.
The Committee Chairman requested that international examples and practices be presented in the next session.
On Dealer Commission, Mr. Khuda Baksh shared that PPDA had submitted a formal written proposal for an increase in dealer commissions. He requested that Senior PPDA Member Ch. Zafar Elahi be allowed to present further details. Upon approval, Mr. Elahi explained that PPDA’s initial demand was an increase of Rs. 2.80 per liter. After discussions and calculations by OGRA, the revised demand became Rs. 2.10 per liter. OGRA approved an increase of Rs. 1.40 per liter about eight months ago, but implementation is still pending.
He highlighted the rising inflation and financial pressures, requesting that the commission rate be recalculated based on current economic indicators and that PPDA be allowed to present an updated proposal at the next meeting. Both the Committee and the Petroleum Minister agreed to this.
On the issue of Smuggling, Vice Chairman Raja Waseem briefed the Committee about the ongoing smuggling of petroleum products, which is affecting local businesses. Both the Committee Chairman and the Federal Minister acknowledged the problem and noted that due to targeted government efforts, smuggling has noticeably decreased.
The meeting concluded with the following decisions and assurances: ? The deregulation matter will be taken up in the next meeting once PPDA submits its written recommendations.
? The credit card commission issue will be reconsidered based on international practices. ? The proposal to revise dealer commissions was appreciated and can be formally presented in the next session.
