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Italian CNG kit makers fight to lift ban

A ban on compressed natural gas (CNG) kits by the Pakistani government for the last seven months has led to two leading Italian kit manufacturers, afraid of losing investments of billions of rupees, to consider pulling out their investments as they ask for the ban to be lifted.

The Chief Executive (CEO) of Landirenzo, Alberto Barbieri along with the Chief Executive of BRC (Gas Equipment) Arshad Altaf has argued that the sudden ban on CNG kit imports to Pakistan have badly hurt foreign investors, who made huge investments in the sector. They also warned that if their CNG investments are not saved, future investments in the energy sector will be at risk.

 

Barbieri claims that 50% of the parts needed for the CNG kits are manufactured in Pakistan but the rest needs to be imported from Italy. Therefore, he termed the ban on CNG kits as sheer discrimination against the CNG industry, which takes up only 9.1% of the total gas consumption in Pakistan, even less than the gas line losses of 10%. And so implies that the severe gas shortage facing Pakistan cannot be a sustained reason for prolonging the ban. Yet the government argue that CNG is the fastest growing gas-consuming industry and that its demands have quickly shot up to 14% of the total gas consumption.

Nevertheless, CEO of BRC (Gas Equipment), Altaf, has urged the government to focus on line losses of gas distribution companies through theft and leakage and to encourage investors to explore new gas reserves. BRC’s Original Equipment Manufacturer, Hasan Askari, revealed that the government is shutting down CNG stations from one to three days a week and so we are able to see clearly the impact of the ban on all people involved in the CNG sector. The government itself can also feel the loss being made from the ban as it is losing revenue from the CNG kit manufacturers that were exporting around 60,000 kits to Afghanistan, Italy, Thailand, China, Brazil, Iran and Bangladesh. Following the ban on CNG kits, the government is said to be losing $6 million in foreign exchange a year.

Consequently the CEO of Landirenzo has hope in the Pakistani government lifting the ban and allowing Italian parts to be imported to Pakistan for the production of CNG kits. His faith lies primarily in his conviction that the company is not an importer but a manufacturer that has invested billions of rupees into Pakistan.

Source: The Express Tribune