In distress call, traders seek tariff cut

Say electricity rates reach unsustainable levels that threaten competitiveness

LAHORE:

The Lahore Chamber of Commerce and Industry (LCCI) has issued a distress call, urging the government to bring Pakistan's industrial electricity tariff under control, which is the highest in the region and posing a grave threat to the country's competitiveness at the global level.

In a statement, LCCI President Mian Abuzar Shad, Senior Vice President Engineer Khalid Usman and Vice President Shahid Nazir Chaudhry said that industrial power tariffs had reached unsustainable levels, currently averaging around 14 cents per kilowatt-hour (kWh).

These rates starkly contrast with those in neighbouring countries where industrial tariffs are kept significantly lower to support business growth, they argued.

They cited the example of Afghanistan, India and Bangladesh, where the industrial power tariff was around 7 cents, 8 cents and 6 cents per kWh, respectively. These differences, according to the business leaders, create an uneven playing field and put Pakistan's industries at a severe disadvantage in global markets.

"While competitors in the region are empowered by more favourable energy costs, our industries face insurmountable operational expenses that limit our global competitiveness," the statement quoted the LCCI office-bearers as saying.

They pressed the government to act swiftly as aligning Pakistan's electricity tariffs with regional standards was critical for uplifting the export-focused businesses and achieving economic sustainability.

They underscored the need for encouraging private sector investment in solar and wind energy through tax credits, subsidies and low-cost financing to reduce reliance on costly imported fuels.

Moreover, micro-grids powered by solar and small wind farms can provide cost-effective, reliable electricity, and minimise transmission losses in remote and rural areas.