LAHORE: The Oil Marketing Association of Pakistan (OMAP) has proposed the establishment of a dedicated unit within the Special Investment Facilitation Council (SIFC) to address the challenges faced by Oil Marketing Companies (OMCs) and local investors.

In a letter to the Secretary of SIFC, OMAP Chairman Tariq Wazir Ali stated that purpose of establishing this unit would streamline bureaucratic processes, advocate progressive and investor-friendly policies, and ensure a balanced approach to both foreign and domestic investment initiatives.

The association suggested that unit should also ensure close liaison with Oil and Gas Regulatory Authority (OGRA) and emerging OMCs to build confidence among local investors in this sector.

Tariq Wazir Ali appreciated the SIFC’s initiatives, which play a pivotal role in reshaping Pakistan’s investment landscape. However, he emphasized the need to consider the environment for local investors who have already invested substantial resources and are willing to further invest.

OMCs continue to face significant challenges due to a persistent bureaucratic culture and policies from previous administrative regimes, which create a non-conducive business environment. This not only hinders their operational capabilities but also compels them to reconsider future investments.

The Oil and Gas Regulatory Authority’s current operational focus is also a concern, as it predominantly favours a few large OMCs, which control a major share of the market. This bias stifles competition and places emerging OMCs at a severe disadvantage.

Tariq Wazir Ali highlighted several critical issues, including foreign exchange losses adjustment, smuggling of Iranian diesel, high cost of doing business, absence of OGRA’s role in advocating emerging OMC-friendly policies, lack of creation of a business-friendly environment, and provision of a level playing field. These issues create an existential threat for emerging OMCs.

Despite several letters, meetings, and reminders, OGRA has failed to perform its constitutional role of suggesting and advocating fair policies and support to create a level playing field for all OMCs.

Tariq Wazir Ali acknowledged SIFC’s efforts in attracting new foreign investments and enhancing global trust in Pakistan’s economic potential. He emphasized that OMAP, as the only legal and leading association representing OMCs in the country, plays a pivotal role in shaping and advocating for the interests of the oil marketing industry.

OMAP strives to enhance operational efficiency and create opportunities for sustainable growth within the oil marketing industry, ultimately attracting new local and foreign investment. However, OGRA’s current push towards deregulation of petroleum product prices without comprehensive stakeholder engagement or consideration of broader impacts on the economy and employment is a concern.

Tariq Wazir Ali emphasized that the potential for growth and prosperity in Pakistan is immense, especially in the petroleum sector, if local enterprises are provided with a fair playing field, swift regulatory approvals, and supportive fiscal policies.

Copyright Business Recorder, 2024

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