Oil refiners’ pre-conditions

The country’s oil refineries have not only rejected the government’s new deadline (December 2008) for switchover from the production of low quality diesel to a better quality, Euro-II, but they have also demanded a string of tax concessions and fixing of a higher market rate for low sulphur diesel.
The main demands put forward by refineries include zero-rated duty, exemption from all government levies on import of plants and machinery, and at least 36 months for the switchover following acceptance of their demands, which would take the deadline to December 2009! The earlier deadline set by the government for the switchover was July 2006, which was extended to December 2008 on the industry’s plea that the time allowed for conducting feasibility studies, etc was insufficient. The World Bank has repeatedly reminded the government that early introduction of Euro-II diesel can help Pakistan address its air pollution problem in major cities like Karachi, Lahore and Rawalpindi/Islamabad. Sulphur dioxide, a compound of sulphur whose content in Euro-I is dangerously high, can cause acid rain, and lead to serious health complications for those exposed to it. Euro-II, on the other hand, is a quality diesel, which causes less pollution due to its 500-ppm sulphur content.
While the developed world has since long switched over to cleaner and more efficient fuels for combating environmental pollution, Pakistan has unfortunately remained stuck in the planning phase. The “conditionalities” set by the refineries may well seem to have an exploitative angle, as these would not only delay implementation of an important environmental project, but would also lead to further pushing up the diesel price in the market, with its multi-faceted effect on all sectors of the economy. A letter written by the Oil Companies Advisory Committee (OCAC) to the Petroleum Ministry bases the demand for zero-rated duty and other exemptions on the plea that the up-gradation of refineries is a capital-intensive undertaking requiring an investment of $500 million. However, given the huge profit margin already allowed to the oil industry, it should not be extremely difficult for it to make part of the investment on its own and the government should pursue the issue of return on additional investment with them in earnest.
This would ensure that this “pre-condition” does not become a bar or hindrance to the switchover to Euro-II. Secondly, the lead-time demanded by refineries is too long in view of the rapid environmental degradation all major urban centres are experiencing because of the highly poisonous motor exhaust fumes released day in and day out. According to a UN study, extremely fine carbon particles emitted through motor exhaust can penetrate the deeper recesses of human lungs, causing serious respiratory complications. Other major fuel sector pollutants vitiating urban environment in Pakistan include carbon monoxide, sulphur dioxide, nitrogen dioxide and lead, with the last mentioned being extremely harmful to young and growing children.
Incidentally, the amount of lead annually released through vehicular emissions into the air in Pakistan is said to be 520 metric tonnes! Delaying implementation of the switchover to Euro-II will prove extremely costly in terms of the lost man-hours as well as the expenses incurred on medical treatment of pollution diseases. Secondly, it will put further strain on the already over-stretched health infrastructure in the country. A healthy workforce is the first requirement for a country’s economic progress.

Fifty years on

Today the United States is viewed in the Arab world as a too-often blundering and ill-informed imperialistic meddler, whose judgment of the Middle East is always distorted by its slavish support for Israel. Fifty years ago its reputation could hardly have been more different.
In October 1956, France, Israel and the UK conspired to invade Egypt and re-seize the Suez canal which had been nationalized by Gamal Abdel Nasser four months earlier. It was forceful intervention by Washington and President Eisenhower that brought this neocolonialist adventure to an end and forced London, Paris and Tel Aviv into a humiliating climb down. It was very probably the CIA which helped the Free Officers’ movement, led by Muhammad Najib and Nasser, overthrow the British-backed Egyptian monarchy in 1952.
Nasser certainly enjoyed very close relations with the Americans. He was probably leaked top-secret State Department documents by the CIA. Thus one evening Kermit Roosevelt was a guest in his Cairo home. The US diplomat and son of the wartime president had the task of impersonating Nasser in the State Department’s highly confidential role — playing games in which they tried to figure out how foreign leaders would react to given circumstances. Roosevelt was dining with Nasser precisely so he could learn his part better. Over coffee, as they were discussing the gathering Suez crisis, Nasser amazed Roosevelt by asking him “So tell me Kermit, what will I do next?”
Eisenhower’s decisive intervention after the Suez invasion was of high principle. Certainly Washington thought it time to cut the fading imperial European powers down to size. There was also a strong belief that the Middle East should be left to decide its own future without outside meddling.
How things have changed! Post-Suez the Americans were offended when Nasser chose to take Soviet rather than US aid to build the Aswan dam. Thereafter Moscow’s influence grew while Washington’s declined. Thus America, stung by its ultimate diplomatic failure after Suez has hobbled all its subsequent Middle Eastern initiatives. The transfer of its regional support to Israel has rendered useless so much of what it has tried to achieve. How very different Washington’s position in the Middle East might have been if it had not been carrying the Israeli albatross around its neck. How much more convincing would its campaign against an Iranian nuclear weapon be, if it had not connived and very probably assisted Israel to build its own nuclear arsenal?
As Americans struggle to understand the reason for their spectacular failure in Iraq, they appear busy blaming everyone and everything except their own highly partial record in the Middle East. What they apparently will not understand is that when they teamed up with Israel, the third aggressor against Nasser’s Egypt, they forfeited an immense degree of respect and trust. The lack of both lies at the heart of all their setbacks in the region, not least Iraq.

—Arab News