Duties for Fuel Imports to be Lowered
The government has plans to bring down the import duties of diesel and jet fuel to zero and cutting duties of fuel oil from three percent down to one starting in July. This move will boost the imports of these types of fuel as the demand for power goes up in the summer.
Analysts say that this is a preemptive move by the government just in case the country needs to import diesel fuel if the power crisis worsens. Oil traders also said by implementing the zero percent duty, the diesel imports might blow out of proportions and at the same time lift the middle distillate market. But all of these moves will be dependent on the decision of Sinopec and PetroChina which control most of the import permits for fuel in the country.
By lowering the duty for jet fuel the government is helping airlines to compete with the rapidly growing high-speed railways to give them the chance to possibly lower fares and increase the amount of flights in different locations.
Analysts also said that while lowering the duties on imports doesn’t necessarily mean an increase in imports since there were no changes in the imports in the past few months. Suppliers said that there was ample supply readily available and demand is growing at such a slow pace because of the tightened credit supply by the government.
Import duties for nickel and zinc scrap will also be lowered as well as duty for refined zinc.