Page 8 - TEXtalks. September-October 2022

09

RCED set to lessen

textile sector woes in

Pakistan

The significance of energy for the textile industry committing to setting up 1000 garment plants. Each
could be judged by the fact that the recent sharp plant will consist of 500 stitching machines at an
gas and electricity price increases caused by the investment of $7 million; able to produce garments
war in Ukraine have added to the woes of the textile for exports of $20 million per annum, while
industry in Europe, which is heavily dependent on generating employment for 700 workers. The total
energy. Despite several billion euros in government investment would be US $7 billion generating
aid pledged for textile firms, industry executives are annual exports of $20 billion and providing
calling for a coordinated European plan to avert employment to well over 700,000 workers. A
distortions in competition. Director General Euratex thousand garment plants will be established near
Dirk Vantyghem said, “That would avoid creating major textile-producing cities.
competition among European countries.”
The present government has agreed to continue
Pakistan’s textile exports have witnessed growth with US Cents 9 per kWh tariff for the textile
from 2012 to 2022, crossing $19 billion against industry. The industry had a strong case keeping in
around $13 billion back in 2013. Ahead, Pakistan view the electricity tariff in China, Xinjiang, Vietnam,
can potentially increase textile exports to $35 billion Bangladesh, India, and Indian Punjab at US Cents
in the next five years if the country maintains 8, 7.5, 7, 7, 7.2, and 7 per kWh respectively.
consistent policies.
Khurran Mukhtar, another leading entrepreneur
Patron-in-Chief of All Pakistan Textile Mills from Pakistan Textile Exporters Association (PTEA)
Association (APTMA) Gohar Ejaz says that the is of the view that continuity of RCET, reforming the
regionally competitive electricity tariffs (RCET) have entire power sector, and eliminating cross-subsidies
enabled the textile sector to perform exceptionally are essential to growing the textile sector. This is
well. All the political parties have acknowledged the loaded on the sector when the average tariff is
textile sector’s performance in the past few years. determined. In the case of Gas, 8.5 percent UFG is
being charged to the sector, whereas the textile
It may be noted that the outgoing government has
been very supportive to the textile industry sector does not have more than 0.5 percent losses.
throughout its tenure of four years. This continuous Gas distribution companies have real-time excess
support has not only increased textile exports but from their SMS to consumer TBS. They can monitor
also led to a commitment on the part of the textile volume & pressure on a real-time basis. Even then,
sector to unprecedented value addition by industrial consumers are burdened by high UFG.

September/October 2022