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Saturday, February 24, 2024

Hosiery exporters threaten to shut down units over gas tariff hike

Garment worker’s protests continued unabated in Bangladesh even after the government issued a notification for enhancement of minimum wage to Tk12500 with buyers concerned with the situation withholding orders.

Hosiery Manufacturers on Saturday threatened to shut down their units, burn their export orders, and observe ‘no export days’ until the government revisits its decision to hike the gas tariff, which they said made their businesses unviable and uncompetitive.

An emergency meeting by the Pakistan Hosiery Manufacturers and Exporters Association (PHMA) Southern Zone, expressed its reservations over the government’s subsidy policy, which it said favored the fertilizer and domestic sectors at the expense of the export-oriented industries.

The PHMA Patron In-Chief Muhammad Jawed Bilwani said the association had taken up the matter with the high-ups in the government, including the federal energy minister, the federal finance minister, and the prime minister, but to no avail.

“The ill-advised decision of the government has made the export-oriented unviable and uncompetitive in international markets without realizing that in these trying and testing times when the country direly needs foreign exchange to control trade deficit and current account deficit,” Bilwani said.

“The insensible move by the government will shatter the exports and will lead to huge closure of industries, lay-offs creating huge retrenchment of labor and can also lead to bankruptcies of manufacturing units.”

He said the industries of Karachi had appealed to the government to intervene and revisit the decision in the national interest to save and sustain the industry from complete collapse and export sabotage.

A PHMA statement said its general body members endorsed the submissions of Bilwani and unanimously resolved that PHMA, as well as all the stakeholders associations and the Karachi Chamber of Commerce and Industry (KCCI), must strongly take up the matter with all concerned in the government.

The export industries and indirect exporters were not in a position to bear and absorb the exorbitant increase in industrial gas tariff, which was already burdened with other additional costs, such as costly water tariff, additional cost of power generation due to load shedding, and high cost of doing business, it added

The PHMA warned that if the government did not provide relief to the industries, they would be forced to take extreme measures, such as shutting down their units or going on strike, to protect their interests and survival.

It also demanded that the government should apply the tariff of Rs 1350 per million British thermal units (MMBTU) determined by the Oil and Gas Regulatory Authority (OGRA) to both the fertilizer and domestic sectors, and provide a fair gas tariff of Rs 1350 per MMBTU to the export-oriented industries, which was the 100 percent cost of gas.

They said they feared that their export business would be lost up to 70 percent to 80 percent if the government was unwilling to revisit the decision, and they would even lose the remaining 20 percent to 30 percent of business and be completely closed.

The exporters unanimously resolved that the industries of Karachi (SSGCL-linked) would go for continuous protest against the government on this unwise decision to exorbitantly increase the industrial gas tariff, which they could not bear and absorb, being already heavily burdened with the highest cost of manufacturing, which had made them unviable and uncompetitive to operate.

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