Coal import costing exchequer ‘Rs211b’

Senate panel urges uniform gas tariff for industries

ISLAMABAD:

The Senate Standing Committee on Trade, while emphasising the need for locally-produced coal in the power generation in order to reduce its import, on Thursday directed for a uniform tariff of gas, being provided to the industries across the country,

The current committee held its last meeting, as it would be reconstituted after the upcoming election of the upper house of parliament, with Senator Mirza Muhammad Afridi in the chair. The meeting was also attended by Prime Minister’s Adviser on Commerce Razak Dawood.

During the meeting, committee member Usman Kakar raised the question about the import of coal from different countries. “We import 16.5 million tons of coal annually worth Rs211 billion despite the fact that Sindh, Balochistan and Khyber-Pakhtunkhwa have large coal reserves,” he pointed out.

He asked as to why coal was imported. “What is the difference between imported and local coal?”

The special commerce secretary replied that Sindh’s coal could be used only for power generation because of high sulphur content.

“Coal is imported to generate cheap electricity,” the official said. The committee was also informed that 60% electricity in the United States and China and 70% in India is generated through coal. Kakar said: “We import coal from 20 countries. If we set up our own plants, there will be no need for it.”

The chair asked how could the country get rid of imports and start using the local coal. He also directed the commerce ministry to write a letter to the ministers for minerals of the four provinces, in which it should be clarified that local coal should be used through new machinery.

Textiles

The meeting was informed that the textile policy had been sent to the Economic Coordination Committee of the Cabinet, where its approval is awaited. The commerce ministry officials said that the ECC had formed a committee on the textile policy which includes all stakeholders.

Sitting on the committee, Senator Rana Mahmood ul Hassan said that Pakistan imported cotton worth $4 billion. He pointed out that the country’s cotton production used to be 15 million bales, but now it has reduced to 7 million bales.

Hassan also said that India was behind Pakistan in cotton production, but it had increased the output to 40 million bales. He lamented the unavailability of quality cotton seen in Pakistan and stressed that the government should guide the farmers in this regard.

The chair observed that Cotton was an essential ingredient for the textile industry. “We have the textiles but the seeds are with the National Food Security Ministry,” Afridi said, adding that the food ministry had the authority to conduct surveys on seeds.

The committee also expressed concern over the difference in gas prices. The chairman of the committee said that gas should be supplied to industries across the country at uniform rate. The commerce ministry officials said they would submit the recommendation to the ministry concerned.

Meanwhile, briefing the committee, Commerce adviser Razak Dawood said that the government levied additional customs duty after joining the International Monetary Fund (IMF) programme. He added that the IMF had asked the government to increase its revenue.

Dawood said that the increase in the customs duty was of two, four and seven %. “When we increased the duties, it had a direct effect on our exports. We have reduced the duties and after that we are now competing with Bangladesh in exports.

Dawood also told the committee that he was “working hard to reduce electricity and gas prices”. The adviser revealed that five to six meetings in this regard had been held, while there was some progress on the other day.