LAHORE:
Despite getting instructions from the finance ministry, Pakistan State Oil is reluctant to increase the credit limit for cash-strapped Pakistan Railways for the purchase of furnace oil.
Pakistan Railways as a result has been compelled to purchase oil on a daily basis, which often causes trains to halt operations.
The fixed credit line to Railways is Rs1 billion but the finance ministry instructs the oil marketing company (OMC) to increase credit line to Rs2 billion when fuel crisis deepens.
Despite the credit line being consumed, PSO on Wednesday agreed to provide 1 million litres of diesel to Railways upon the assurance of a high-ranked officer of the Railways, an official said.
However, this was not enough as train operations came to a halt on Thursday as Railways oil depot in Lahore division dried up.
Couple of trains were cancelled by the administration including Ghauri and Quetta Express scheduled to depart for Faisalabad and Quetta, respectively, while trains scheduled to depart in the evening were made to wait until the fresh fuel consignment of 48,000 litres arrived at 3.30 pm in Lahore.
There were almost six trains that departed late as they were waiting for arrival of fuel including Fareed Express, Khyber Mail, Awam Express, Taiz Gam, Allama Iqbal Express. Lahore division needs 48,000 litres of diesel daily to streamline the operations.
The financially-hit Pakistan Railways is currently operating with a fleet of 84 locomotives and 84 trains from a total of 204 trains. Pakistan Railways currently needs fuel supply of around 0.3 million daily to operate its passenger and express trains against demand of more than 0.4 million litres when Railways was operating all its fleet.
“We are now depositing cheques regularly to them but they are still reluctant to supply us fuel on credit basis, said PR public relations Director Abdul Hameed Razi while talking to The Express Tribune.
“The cheques PR dispatched always bounce, how can we rely on such a department?” said PSO spokesperson Mariam Shah. PSO will not agree to extend the credit line to Rs2 billion as PR is no more credible, added Shah.
The country’s largest oil marketing company has already briefed the finance ministry why it is reluctant to extend the credit line.
Pakistan Railways has already exceeded its credit limit of Rs1 billion and after the fresh dispatch of a million litres of diesel, total payables have now climbed to Rs1.2 billion, said Shah.
The financial condition of PSO is not well itself as it has over Rs170 billion clogged in the circular debt, Shah added.
Published in The Express Tribune, December 16th, 2011.
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R.I.P. PR
When people and companies stop paying their bills things slowly come to a standstill --- why this basic principle of business eludes Pakistani's is beyond me.