KARACHI: The value-added textile export industry of Karachi on Thursday slammed the PML-N led federal coalition government for “utter” silence on their SOS calls regarding the cut-off of legitimate gas supplies to the manufacturing units, which is causing huge financial losses to the industrialists.
“The industries cannot operate without gas which causes them colossal financial losses,” a group of representatives from the value-added textile export sector associations of Karachi told a news conference at the PHMA House.
They said that are “deeply shocked” and completely “disappointed” with the federal coalition government, Prime Minister and his economic and energy team for ignoring the SOS calls from Karachi-based textile industry, as their productions are nearing to a stop with no gas supplies.
They demanded of the Prime Minister to intervene immediately to solve the crisis. The city’s exporters are “highly hopeless” under the present circumstances that may bring their businesses to a closure and relocate their industry abroad, they said.
“The industries of Karachi have been deprived of its legitimate gas share for the last several decades,” they said adding that PM Shehbaz Sharif has ignored Karachi-based industries like his predecessors did in the past.
“On other hand, prime minister has been holding meetings with the spinners association of Punjab,” they said adding that the ECC has increased RLNG rates from $6.5 mmbtu to $9 mmbtu without consulting with the industry stakeholders from Karachi.
Locally produced gas will be made available at Rs1,350 per mmbtu or $6.6 mmbtu with an increase of 65 percent for Sindh and RLNG at $9 mmbtu for the SSGCL consumers, which they termed “unjustified and unacceptable”.
The PTI government had approved RLNG $6.5 mmbtu tariffs for export-oriented industries across Pakistan but the same was implemented only for the SNGPL consumers, excluding the SSGCL subscribers, they said.
RLNG supplies for industrial consumers were charged in January 2021 at Rs1361 per mmbtu, which was increased till June 2022 to Rs 4626 per mmbtu. Last fiscal year, the government disbursed Rs81 billion against the subsidy on RLNG Competitive Tariff in Punjab only, they added.
They also demanded of the government to make 110mmcfd gas allocation each from Ghotki and Marri to SSGCL and SNGPL, respectively. “Karachi’s exporters are of a confirmed view that their calls will not be answered, as there is no one in the incumbent federal government to see the situation on merit,” they said.
They also felt that there may be some “ulterior” motives to target Karachi’s industry purposely and victimize it to a point where they could make a decisive step to relocate their units abroad.
“The export industries of Karachi are also victimized and denied of other alternate fuel,” they said that a subsidy is given only to Punjab. A subsidy, which is given to Punjab, is mainly made from taxes that Karachi produces, they said.
They asked the federal government to stop the “discrimination” against Karachi, as the country’s largest city generates 70 percent of the total national revenues and contributes 54 percent in total national exports and 52 percent in textile ones.
They said that the textile sector performed last fiscal year 2021-22 with a $4 billion export growth of which $2 billion share was by the Karachi’s industry, adding that the government punishes it for a sizeable foreign exchange gains.
They said that the federal government under the guise of export facilitation supports Punjab’s industry ignoring Karachi completely, adding that the industry is also charged for a subsidy provided to domestic and fertilizer sector.
Karachi continues to suffer for the last 35 years because of an infrastructure dearth, water scarcity, power and gas, “extortion” and disorder with spontaneous street crimes and lack of civic facilities, they added.
They asked the federal government that as to why Karachi should bear the “brunt” of gas shortage alone, saying that there should an equal and fair treatment for entire country. They called the lack of legitimate gas supply to Karachi an “unconstitutional act”.
With no gas supplies to export industries, productions have completely stopped, they said. They added that several units will see a closure after Eidul Azha that may unleash “massive” layoffs and a drastic decline revenues generation. The industry is also struggling with no alternative energy sources.
The textile sector has performed beyond “excellence” with $19.4 billion of exports up by 26 percent, or $4 billion, standing out with contributing to the total national exports of approximately $31.76 billion.
The 26 percent growth in value-added textile exports amounting to the increase of equal percentage in jobs, besides revenues and taxes. The associations saw the super-tax on the textile sector as a “punishment” by the government for its growth of $4 billion.
Over 40 allied industries of textile also excelled in their growth. Similarly, Karachi generates around 70 percent revenues to the national exchequer. Karachi also took the lead in the country’s total textile exports by 50 percent, they said.
Those spoke at the news conference included: Jawed Bilwani, Chairman, Pakistan Apparel Forum & Chief Coordinator, Value Added Textile Forum, Abdul Rehman, Chairman, Abdul Qadir Bilwani, Sr Vice Chairman, Faisal Arshad Sheikh, Vice Chairman, Pakistan Hosiery Manufacturers & Exporters Association, Kamran Chandna, Chairman, Pakistan Knitwear and Sweater Exporters Association, Shaikh Shafiq Jhokwala, Chairman, Pakistan Readymade Garment Manufacturers & Exporter Association, Kashif Mahtab Chawla, Chairman, Towel Manufacturers Association of Pakistan, Abdul Samad, Former Chairman, Pakistan Cloth Merchants Association and various other representatives and exporters of the sector.
Copyright Business Recorder, 2022
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