Mr Zahid Mazhar, APTMA Chairman (Sindh Baluchistan Region) has rejected the proposed increase in gas prices.
For the next financial year starting July 01, 2019, the govt. is increasing gas price by 31pc. He said that the industry is already facing high manufacturing costs as compared to regional competitors.
Such anti-industry and anti-export measures including the adverse decision of withdrawal of zero rating facility taken by the govt. are like the continuity of policies leading to deindustrialization of the previous government, he added. The gas tariff for industry in Bangladesh is US$ 3.0/MMBTU which is more than 50pc cheaper than Pakistan.
Mr Mazhar said that the Ogra had fixed Unaccounted for Gas (UFG) @ 4.5pc for the last few years but both gas companies continued on the opposite route reaching levels of around 14pc – 15pc, this meant huge direct loss to the nation in terms of substitution cost (in dollars) besides direct cost of significant environmental degradation. In an efficient gas system run by professional managements in other countries, UFG is less than 3pc covering, essentially, uncontrollable gas loss arising from operational work on gas lines.
He said that earlier, due to high cost of doing business, inadequate supply of raw material, drastic increase in interest rate and liquidity constraints due to huge delay in refunds of sales tax, almost 140 textile mills have already closed their operation resulting in about one million workers have lost their jobs and around 75 to 80 mills are on the verge of closure which will add the unemployment figure by another 0.5 million labor force employed in the textile industry. He further said that due to the closure of about 140 mills and the mills operating under capacity Pakistan’s textile exports is suffering an opportunity loss of more than 4 billion US$ per annum.
Mr Mazhar demanded the government to save the export-oriented textile industry and Pakistan from complete disaster by not increasing the gas prices and instructing the gas utility companies to meet their revenue requirements by strictly following the UFG Benchmark in accordance with the international best practice and reducing other expenses with better management.
