The International Monetary Fund (IMF) has reportedly written to the Ministry of Finance and Federal Board of Revenue (FBR) seeking information on steps taken to curtail the smuggling of petrol into Pakistan.
Citing sources within the finance ministry, several media outlets have reported that the global lender has expressed concern over the large quantities of oil smuggled into the country and its potential impact on revenue generation. According to some estimates, roughly 143 million liters of petroleum products are smuggled into Pakistan monthly, with the practice costing the country roughly Rs. 10 billion in customs levy alone annually. In its letter, the IMF has demanded an increase in the number of customs, intelligence and security officers in the border areas to ensure smuggling is curtailed.
The IMF’s letter follows the incumbent interim government initiating a crackdown against smuggling in a bid to restore confidence in the national currency and reduce inflation triggered by shortages of commodities. Earlier this month, Caretaker Prime Minister Anwaarul Haq Kakar directed customs officials to improve surveillance throughout the border areas, especially “irregular” crossings, to prevent smuggling into and out of the country.
According to daily The News, authorities have submitted a report to the Prime Minister’s House alleging that revenue generated from petrol smuggling is being utilized as a source of funding by terrorists. The report, which has not been made public, has alleged that 2.8 billion liters of petrol is smuggled annually from Iran to Pakistan, costing the national exchequer Rs. 60 billion.