ISLAMABAD: The country’s oil import bill rose to $17.03 billion during the first ten months of FY 2021-22 (Fiscal 2022), an increase of 95.9 percent compared to $8.69 billion recorded for the same period last year.
According to the Pakistan Economic Survey released on Thursday, high oil prices in global markets and sharp depreciation of the Pakistani rupee have made oil more expensive, putting painful pressure on the external sector and consequently widening the trade deficit. .
The increase in oil import bill was also attributed to increase in demand.
Imports of petroleum products grew by 121.15 per cent year-on-year in value terms and 24.18 per cent in volume terms. Crude oil imports grew by 75.34 per cent in value and 1.4 per cent in volume, while liquefied natural gas (LNG) imports grew by 82.9 per cent and liquefied petroleum gas (LPG) by 39.86 per cent.
The country’s dependence on LNG has increased in recent years due to dwindling reserves of indigenous natural gas. Over the past three years, the stock of circular debt in the gas sector has nearly doubled to Rs 650 billion from Rs 350 billion in 2018. The government’s sluggish response to issues in the sector has created problems with imports of LNG by the private sector, which the survey said triggered a gas crisis in the country, especially last winter.
In FY21, around 373 million mmBtu of LNG gas, worth about $3.4 billion, was imported, accounting for about 30 per cent of the total natural gas consumption in the country. During the first eight months of the last financial year, however, 75.64 per cent of the gas consumed was produced domestically, while 24.36 per cent was imported.
Power generation from coal reached 5,280 megawatts (MW) during the period under review, with Thar coal contributing 1,320MW and imported coal totaling 3,960MW, or 75pc. The heavy reliance on imported coal is likely to change as power generation units operating on Thar coal are gradually added to the power generation mix.
Against the total hydroelectric potential of about 60,000 MW, the country is still using only 16pc. The survey said that high investment cost for setting up of hydroelectric power plants, development of power transmission network and rehabilitation of the affected population are some of the reasons why hydropower is not being exploited to its full potential. At present the installed hydropower capacity is 10,251MW, which is about 25pc of the total installed capacity of the country.
Nuclear power plants had a gross generation capacity of 2,530MW in FY21, supplying about 7,076 million units of electricity to the national grid. It grew by 39 per cent to 3,530MW in the outgoing financial year. Nuclear plants supplied 12,885 million units to the national grid during the period under review.
Thermal power still accounts for the largest share of electricity generation in the country, though its percentage contribution to the overall mix declined from 62.5 per cent during the first ten months of the previous fiscal to 60.9 per cent during the same period of FY22.
The first ten months of the last financial year also saw a slight change in the electricity consumption pattern. The share of households in electricity consumption declined from 49.1 per cent in FY21 to 47 per cent in FY22. The commercial sector also saw a marginal decline in electricity consumption, down from 7.4 per cent in FY22, to 7 per cent in FY22.
On the other hand, the share of the industry increased to 28 per cent from 26.3 per cent last year.
Published in Dawn, June 10, 2022