A significant price gap between diesel and petrol in Bangladesh and India has allegedly fuelled an ongoing smuggling operation, according to a recent investigation.
The difference of Tk22-25 per litre between Kolkata in India and Dhaka in Bangladesh has created an opportunity for smugglers to illegally transport fuel across the border.
Energy experts and economists highlight that diesel prices in India are higher than in Bangladesh, making smuggling an inevitable consequence. They recommend narrowing the price gap to Tk5 per litre to mitigate this issue.
“Reducing the price difference will curb smuggling and ease the burden of additional fuel imports, ultimately saving foreign currency,” said an energy expert.
According to the Bangladesh Petroleum Corporation (BPC), petroleum imports cost the government approximately $5 billion annually, with diesel accounting for 75% of these expenses. The ongoing foreign exchange crisis has further heightened concerns about fuel smuggling.
Sources reveal that organised groups have reportedly been smuggling large quantities of diesel and petrol daily through land ports and border areas. Local truck drivers and residents confirm the allegations, admitting that cargo trucks from neighbouring countries fill their tanks in Bangladesh to take advantage of the lower prices.
BPC Chairman Amin Ul Ahsan has vowed to take action, saying, “We will not allow fuel oil to be smuggled under any circumstances.”
On Friday, diesel was priced at Tk130.49 per litre in Kolkata, compared to Tk105.50 in Bangladesh. Similarly, petrol in Kolkata was selling for Rs104.95 (Tk149.25), while in Bangladesh, it was priced at Tk127 per litre. This creates a Tk25 per litre gap for diesel and a Tk22.25 gap for petrol, which smugglers exploit.
Energy expert Prof Ijaz Hossain said, “The Tk25 price difference is driving smuggling. Reducing the gap and enforcing stricter penalties will help prevent this illegal activity.”
Reports from various land ports suggest that around 1,000 trucks carrying imported goods enter Bangladesh daily. Many fill up their tanks before returning, often bypassing authorities. Some trucks even carry separate tanks to smuggle oil, while local traders supply them with diesel from nearby pumps.
Despite increased surveillance by the Border Guard Bangladesh, particularly at major ports like Benapole, smuggling persists. However, the crackdown has reduced the frequency compared to previous years.
Energy adviser Muhammad Fouzul Kabir Khan acknowledged the challenges, saying, “Raising fuel prices to combat smuggling may anger the public. We need to find a balance between domestic expectations and global oil prices.”
Currently, 15 of Bangladesh’s 24 land ports, including Benapole, Bhomra, and Teknaf, are operational. In the fiscal year 2022-23, approximately 18.7 million tonnes of goods were imported and exported via 1.4 million trucks. Each truck can hold 400 to 500 litres of fuel, creating ample opportunity for smuggling if left unchecked.
BDST: 1147 HRS, SEP 24, 2024
