Refinery policy to cut imports

KARACHI: The latest petroleum refinery upgradation policy offers financial incentives, encouraging Pakistan’s industry to significantly increase the production of high-premium products. The policy aims to double the output of petrol and boost diesel production by 47% in the coming years. This multibillion-dollar and time-consuming initiative is expected to drastically reduce the import of refined products, thereby preserving precious foreign exchange reserves. Survival for refineries hinges on upgrading their technology by installing deep-conversion refineries, a relatively new technology, alongside existing hydro-skimming refineries. According to a detailed report titled ‘Pakistan’s Refinery Sector Upgradation Policy to Incentivise Refineries’ by Arif Habib Limited (AHL), refineries endorsing the policy will receive additional tariff protection or deemed duty incentives, amounting to 10% for Motor Spirit (MS/petrol) and 2.5% for diesel for seven years.