Pakistan Railways runs up billion rupee diesel bill

Owes PSO nearly Rs996 million for purchases made on credit.

LAHORE:

Pakistan Railway’s (PR) owes nearly Rs996 million to Pakistan State Oil (PSO) for diesel purchased on credit, despite all its efforts to minimise cost overruns during the first half of the current financial year, The Express Tribune has learnt.

Although the outstanding amount is staggering, PR says it holds enough stocks of diesel to last it for three days in case of a shortage. It has held the reserves to ensure smooth operations of its fleet.

“Pakistan Railways has been purchasing diesel on a day-to-day basis to meet its 263,000 litres daily requirement,” an official familiar with the matter said.

The daily consumption of diesel was calculated to ensure the smooth operation of the entire Railways infrastructure. In the past, most trains used to be delayed and even cancelled owing to shortages of diesel for locomotives. To address the issue, authorities had allowed divisional superintendents to purchase diesel from the open market to meet requirements in case of shortages in oil supply. According to the official, Lahore requires the largest volume of diesel at 80,000 litres, Karachi requires 75,000 litres and Kotri – which has the least requirement – nonetheless needs 3,000 litres of diesel on a daily basis.

The Pakistan Railways spokesperson said the federal government has fixed the limit for outstanding bills to Rs1 billion. In the past months, PR’s outstanding diesel bill had been kept below the limit even after the government revised the limit to Rs2 billion recently. “Efforts are in progress to minimise the outstanding amount and increase earnings,” he added.

On the other hand, despite the addition of refurbished locomotives and new trains in its operational infrastructure, Pakistan Railways faced Rs1.36 billion shortfall in revenues during the first half of the current fiscal year. The same trend is expected for the remainder of the year, as no new locomotives or trains will be added to the fleet anytime in the foreseeable future. “Owing to this, PR faces a loss of over Rs2.5 billion till the end of the current fiscal year,” an official added.

The total number of operational trains on all routes has reached 88, which include 32 express trains, 30 intra-city trains, 10 passenger trains, eight goods trains, six international trains and two shuttles. “Pakistan Railways also has 150 working locomotives, out of which 120 are in some condition to pull trains smoothly,” the official said.

Published in The Express Tribune, January 9^th, 2013.

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