The value-added textile industry has rejected the frequent increase in prices of gas and electricity, saying such tariffs make Pakistani products uncompetitive in the international market.
Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA) Chairman Adeeb Iqbal remarked that at a time of unsatisfactory export volumes and low industrial growth, the hike in electricity rates to nine US cents per kilowatt-hour (kWh) for the export industry was surprising.
“If the decision is not withdrawn, it will prove dangerous for the country’s garment industry,” he stressed.
The newly elected PRGMEA chairman stressed the need for early approval of the Textile Policy 2020-25 as it would be beneficial to the major exporters.
He said Prime Minister Imran Khan had already accorded approval to the policy in terms of policy directives for the production of goods and diversification of exports.
Iqbal added that approval of the textile policy was the only way that would stimulate more investment in the sector as huge investment was in the pipeline.
He said the growth of value-added textile sector was a must to steer it out the worse situation and contribute to exports of the country. He emphasised that the country had not been able to achieve its maximum export potential and product diversification owing to limited access to raw material.
Iqbal was of the view that procedures for temporary import schemes should be simplified so that exporters could achieve price competitiveness and product diversification.
Pakistan’s exports had been struggling for a long time and to counter that he called for ensuring consistency in long-term policies.
Opposing the government’s decision of raising power tariff for the export sector by 1.5 US cents, he demanded regionally competitive energy tariff for export industries in a bid to capture the global market.
Other industries
Separately, while terming the recent electricity tariff hike for K-Electric consumers an anti-business move, traders and industrialists urged the government to take the decision back.
“This decision will add to the burden on the already struggling industry and the people of Karachi,” said Korangi Association of Trade and Industry (KATI) President Saleemuz Zaman.
“Industry has been asking to reduce energy prices for years as these directly affect the cost of production, which is a real challenge,” he said, adding, “Industrial sector felt a severe burn from the Covid-19 crisis and in this situation we expect relief from the government.”
Endorsing these views, Karachi Chamber of Commerce and Industry (KCCI) President Shariq Vohra stated that the anti-business move would deal a serious blow to the trade and industry, which was still struggling to recover from the disaster caused by the lockdown imposed for six months to contain the pandemic.
Rejecting the federal government’s decision to increase K-Electric’s tariff, Vohra said Karachiites were already suffering badly due to unbridled inflation, hence, the hike in K-Electric’s electricity bills was unacceptable and must be withdrawn immediately.
Vohra said, “Decision-makers will have to understand that if the cost of input rises, it will lead to poor performance and reduced output of the industry, resulting in lower revenue collection, shrinking employment opportunities and uncompetitive products in domestic and international markets.”
Published in The Express Tribune, October 15th, 2020.
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