Diesel import figure
In Bangladesh, almost all of its diesel used to come from the Middle East. Most of the shipments came by ship from Kuwait. However, there has been a major shift in the source of imports in the last two decades. Now, several countries in Southeast Asia have become major suppliers of diesel, while significant quantities also come from India. According to the import data of the National Board of Revenue, 91 percent of the diesel imported by Bangladesh Petroleum Corporation (BPC) in the 2006-07 fiscal year came from Kuwait. At that time, India's share was 9 percent.However, within a decade, the picture began to change.
Singapore quickly rose to the top of the list of diesel suppliers. At one point, the country took the position of the main supplier. At the same time, several other countries, including Malaysia, China, the United Arab Emirates, and Saudi Arabia, were added to the list.Now the sources of imports have become more diverse. In the first eight months of the current fiscal year (July-February), Bangladesh imported about 2.3 million tons of diesel. Of this, 41 percent came from Singapore and 24 percent from Malaysia. As a result, dependence on Middle Eastern countries has now decreased significantly.Two decades ago, a large part of diesel imports into Bangladesh were through government-to-government (G2G) agreements. At that time, Middle Eastern countries were the main suppliers.
Later, gradually, 50 percent of the imports were purchased through competitive international tenders.This increased the number of suppliers and diversified the sources of imports. It is important to note that diesel is still being imported by the government sector. Bangladesh Petroleum Corporation does this import.Diesel is the most widely used fuel in the country's energy system. A large part of road transport - buses, trucks, pickups, covered vans and goods vehicles - is diesel-powered. Diesel is also used to run irrigation machines in the agricultural sector, operate engine-powered boats on rivers and run generators in many industries.
Diesel is also used in some power plants during power shortages. As a result, there is a heavy dependence on this fuel in all sectors - transport, agriculture, industry and power. 24 percent of diesel in the country is used in agriculture.According to BPC data, diesel accounts for about 63 percent of the country's total energy demand. In the 2024-25 fiscal year, the demand for diesel was about 4.35 million tons. A large part of this is met through direct imports. And 7 to 7.5 million tons are obtained annually by refining crude oil.
How much does it come from India?
Although the source of diesel imports has changed, the trend of imports from India has not completely changed. Sometimes it has decreased, sometimes it has increased.According to the National Board of Revenue, 9 percent of diesel imported into the country in the 2006-07 fiscal year came from India. After that, it was in single digits for a few years, but later it sometimes reached a double-digit share.India's share in the last five years was the highest in the 2023-24 fiscal year. That year, about 551,000 tonnes of diesel came from India, which is about 15 percent of total imports.
Several companies, including India's state-owned Indian Oil Corporation Limited, supply diesel to Bangladesh. However, to facilitate the import of diesel from India, the Bangladesh-India Friendship Pipeline has been built between the two countries. This approximately 130-kilometer-long pipeline, built with Indian funding, was commissioned in December 2022. Through this pipeline, diesel from India's Numaligarh refinery reaches the Parbatipur depot in Dinajpur directly. The consignment reaches Bangladesh within two days of sending the oil through the pipeline.A shipment of 5,000 tons of diesel recently arrived in Bangladesh through the pipeline. According to the agreement, it is possible to import about 180,000 tons of diesel annually in this way.
Diversified sources reduce risk
As the sources of diesel imports are diversified, supply risks have also reduced. Earlier, due to high dependence on the Middle East, there was a risk of pressure on fuel supply if there was any instability in the Strait of Hormuz.
Now Bangladesh is importing diesel from various countries including Singapore, Malaysia, China, Indonesia and India. As a result, even if there is a problem in one region, it is possible to ensure supply from alternative sources.State Minister for Power, Energy and Mineral Resources Anindya Islam said, there are now many sources of diesel import. In addition to the G2G agreement, diesel is being purchased through competitive tenders. As a result, the risk of a major crisis in supply has reduced. Diesel is being easily brought through the pipeline from the Numaligarh refinery in India.
The State Minister also said, "We are starting the process of importing 120,000 tons of oil from Brunei. It can also be imported from the United States. This will bring more diversity in the source of import."
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