Businessmen warn of mass industrial shutdowns

Condemn recent hike in electricity rates and its detrimental impact on businesses

KARACHI:

Business community leaders have vehemently condemned the recent hike in electricity rates and issued a stark warning of potential massive industry shutdowns, expressing deep concerns over the detrimental impact on businesses and the economy.

Korangi Association of Trade and Industry (KATI), President, Farazur Rehman took a powerful stance against the frequent surge in electricity prices, calling for immediate action to provide cheaper electricity alternatives. The recent overall increase of 34% in the basic tariff, along with the frequent upward adjustments in electricity rates, has triggered a major outcry from various sectors of the economy.

Rehman expressed serious reservations about the detrimental consequences of such increases on industries and businesses. He pointed out that the rise in electricity prices would lead to severe repercussions for industrialists, service sectors, and SMEs, as their incomes have not kept pace with the escalating electricity tariff. Many industrialists fear that the surging production costs will hinder their ability to compete effectively in the global markets, leading to a potential wave of industrial closures.

The United Business Group (UBG), representing the nation’s economic backbone, also expressed profound concern and anxiety over the recent exorbitant increase in electricity tariffs. President UBG, Zubair Tufail, emphasised that the surge in electric tariffs will have a devastating effect on SMEs and cottage industries. Rather than burdening the already struggling masses, they propose that the government should focus on ceasing the provision of free electricity, gas, and petrol to privileged classes.

Rehman advocated for an alternative approach to ease the burden on the public and the industry. He suggested that the government should focus on providing cheap electricity to alleviate the strain on the economy and prevent further social repercussions. One of the proposed solutions included providing loans at single-digit interest rates to facilitate the acquisition of solar systems for the people, thus promoting sustainable and renewable energy sources. Highlighting the need for urgent action, he called on the government to prioritise renewable energy projects as a way to reduce dependency on conventional electricity sources.

Published in The Express Tribune, July 26^th, 2023.

Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.