At IMF’s behest?: Traders oppose increase in power tariff

Says the hike will hurt the economic activities and will overburden the common man

ISLAMABAD:

Businessmen have condemned the government decision to increase the electricity tariff by 43 paisa per unit, terming it an unjustified move.

They said the hike will hurt the economic activities and will overburden the common man.

Addressing businessmen and traders on Monday, Islamabad Chamber of Commerce and Industry (ICCI) President Muzzamil Hussain Sabri said the government had already collected more than Rs70 billion from the consumers in overbilling.

He demanded an immediate withdrawal of all unjustified charges from the power tariff to provide relief to the public and to bring down the cost of doing business in the country.

“Instead, the government should take urgent measures to reduce the transmission and distribution losses, control power theft and bring transparency in the working of power companies to improve things,” said Sabri.

He said the government should also focus on enhancing the share of hydropower in the energy mix to produce cheaper electricity as hydropower cost just Rs0.08 per kilowatt, compared to Rs18.25 per kilowatt when using furnace oil.

Sabri said that the power tariffs in Pakistan were already highest in the region due to which cost of doing business had gone very high and industrial growth suffered badly.

He said energy prices were highly correlated to the economic growth rate as affordable tariffs boost business and industrial activities, but higher tariffs in Pakistan led to the stagnation of industry, increased production cost, hiked inflation and pushed up the prices of finished goods making Pakistanis exports very uncompetitive. He said the government must not increase power tariffs any further.

He said electricity consumers in Pakistan have to pay for the inefficient and poor performance of power companies because government tended to include transmission and distribution losses, power theft, debt servicing costs of power companies, development surcharges and many other charges in the power tariff which was a great injustice to the consumers.

Published in The Express Tribune, October 21^st, 2014.