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Industrialists join hands to squeeze out CNG sector
All Pakistan Textile Mills, Independent Power Producers Advisory Council, and fertiliser manufacturers teamed up.
Traders and members of the All Pakistan CNG Association in Faisalabad protest against CNG closures. PHOTO: ONLINE/FILE
LAHORE:
Frustrated because of continuous gas shortage, the three major industrial associations have joined hands to crush the Compressed Natural Gas (CNG) sector which they say is expanding at a rate of 25% annually and is eating away at the industrial gas share.
All Pakistan Textile Mills (Aptma), Independent Power Producers Advisory Council (IPPAC), and fertiliser manufacturers teamed up on the Save Pakistan Industry Forum platform to start an awareness campaign on how to utilise natural gas more efficiently. In a joint press briefing, the associations blamed the government’s poor policies of diverting the gas to the CNG sector for providing fuel to 3.5m vehicles powered by CNG in Pakistan instead to industries which they say are on the verge of extinction.
Speaking on the occasion, Aptma Chairman Gohar Ijaz said that one automobile out of every four in the world that uses CNG as a fuel is in Pakistan. He did not give the source for this information. The textile and fertiliser sector has faced 180 days of gas outages last year and if the scenario persists then industries will not have the capacity to even operate for 90 days this year, Ijaz said. The industry has not made any investments as they are unable to cover their fixed costs.
Textile sector has also been unable to expand its workforce therefore the sector is not in a position to accommodate one million influx of labour the market faces every year, he added. The government has given Rs50 billion in subsidies to the CNG sector, however it collected Rs300 billion in high electricity tariffs. The government should focus on giving targeted subsidy, Ijaz said.
Agritech Chief Executive Officer Ahmad Bilal said that the fertiliser sector functioned at 50% of its capacity last year and the company fears that they will only able to operate at 30% of the total capacity due to gas shortfall. Surge in food prices in recent years is due to unavailability of fertilisers, the government imports fertiliser at Rs3,500 per bag and sells it at Rs1,750 per bag after giving billions of rupees as subsidy, he said. The sector can produce 0.6 million tonnes of fertiliser annually, creating a surplus to export, he added. He went on to say that they have injected $2.2 billion in the last four years to expand their operations but to no avail. Fertiliser sector’s profitability has dipped sharply due to gas outages. Presently the CNG sector demands 500 million cubic feet per day (mmcfd) of gas which if not curtailed will hit 2,000 mmcfd and Pakistani industries will collapse, he warned.
Also present on the occasion, IPPAC Chairman Abdullah Yousaf said that generating electricity from gasoline costs Rs22 per unit instead of Rs5 per unit if produced using gas. If Independent Power Producers (IPPs) receive uninterrupted gas supply, Pakistan will be able to curb its energy crisis and be cured from the scourge of circular debt, he stated.
Published in The Express Tribune, June 6th, 2012.
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the policy, imposed by a dictator, of burning mindlessly a precious resource such as CNG in vehicles is utterly stupid.
lahore and entire punjab witnesses gas loadshedding of 8 hours daily in winters because gas is being misused as vehicle fuel. if not for CNG misuse in vehicles, we have excess CNG for home use (first priority) and factories (second priority).
CNG as a fuel in vehicle is NOT sustainable at all and must be discontinued. otherwise we will run out of fuel and have nothing left to use in homes or factories.Recommend
Another result of the dictator’s mindless reign which gave Pakistan no long term benefits.
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How many politicians, MPAs, MNAs do you know of that are industrialists, that are involved in the fertilizer industry, and are running Electricity generating companies??? now compare that to the number of politicians that own atleast 1 CNG station….does anyone here seriously think the CNG lobby will be defeated for the benefit of 200m pakistanis??? I think not…..
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All the people opposing CNG are those who are bank defaulters, drive Prados, with their children studying in foreign countries. The dictator spent money on public welfare, education, health. His policy of promoting CNG is being copied in USA India Malaysia Thailand. In USA India the price of CNG is less than half of Pakistan. But because we have all the rich people who control our policy Air polution will increase to level where no child will be able to breath.
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@what why:
BS CNG is a direct subsidy to the Middle and lower Middle class. The Textile and cement lobby (notoriously corrupt and tax dodgers) who get cheap gas and pay a pittance to workers or as taxes are spending alot of money in media to vilify the CNG owners. PPl arent stupid. Go ET for your balanced coverage..
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Do keep in mind top priority is industry as it employes people and contributes in earning foreign exchange .Please be above Prado etc@Arif:
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The conflict has only risen due to the short sighted approach by the policy makers/ rulers of the country, when promoting CNG for vehicles. While the rest of the world is focusing on curbing pollution through promotion of clean fuel policies, we on the other hand in Paksitan are tyring to kill off the only clean fuel industry we have developed so far.
However having said the above, I realize that the issues faced by the industrial sector is very grave and should be our priority. If by providing gas we can help the industries revive the manufacturing units, then it should be so.
However there is still an urgent need to develop a long term policy to overcome the present energy shortfall. If nothing is done that the industries will be asking for closure of gas to homes as well so that we can save the industries, in the next 02 to 03 years. Moreover the white elephant in the room i.e the circular debt issue is not being addressed which will have disastrous conseques to our economy within a matter of months.
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Shut all the industries (textiles, cement, power companies, fertilizer, paper & board) down and go drive around on the cheap for a couple of months….i’ll see how far you guys get. When people don’t have a steady inflow of income, we’ll see how they prize “cheap” and “clean” fuel over having a house, food, and future for our children…I wish the CNG sector was providing the same number and quality of employment as industries do and I wish we could earn foreign exchange from our CNG sector…then maybe i would agree with some of the downright retarded comments being made here. .even educated people can’t think straight….Recommend
In the Sui gas field in Balochistan, the gas reserves are depleting extremely fast. There are reserves only for the next five years until 2017. After that we will happily go back to a bright future of collecting wood and burning gobar in homes for cooking. Bye bye to hot water from geyser; only cold showers in winters. Gobar and wood emit a lot of carbon monoxide and soot, so your womenfolk will get cancer or go blind as they cook food using gobar and wood. Punjab and KPK are already suffering 8 hours of gas loadshedding in winters.
If we keep burning CNG in vehicles, Sindh and Balochistan will also start suffering from gas shortage (which they are not at present) in less than 5 years.
If we stop providing gas to export-based industry, we will have even more unemployment than at present. All the idle people will turn to crimes and terrorism and create social unrest. Plus no taxes collected from companies and employees.
Priority usage for gas should be:
1) home use
2) tax-paying export industry
3) non-exporting industry
4) tax-dodging industrialists = NO GAS
CNG as vehicle fuel is CRIMINAL. Say NO to CNG use in vehicles. Remember in 5 years we may not have any gas left to burn in homes, factories, and vehicles.Recommend
Pakistan is No 1 in using CNG vehicles . Now let us think seriously do we have more gas than any other country of the world? Can a country like Pakistan afford such luxury? The answer is a loud NNNNOOOO. There are in total a bout 3300 CNG stations in Pakistan. They provide a livelihood to about 15000 persons and that is not a quality livelihood. It can not be more than 10,000 per person. But in contrast only fertilizer sector provides livelihood to 20000 persons. And every body knows what charm it is to be a fertilizer sector employ. And it consumes half the gas which CNG sector does. So dear All its time to rethink for all of us. Otherwise we shall be history.
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