The energy cost per unit for the textile mills in Punjab has crossed Rs 10 from earlier Rs 8 with a sudden rise in the Brent crude oil-linked price of Regasified Liquid Natural Gas (RLNG) in Pakistan. As many as 100 textile mills are at the verge of closure, out of which some 35 have already closed down operations while another 35 planning a closure sooner than later, industry sources told Business Recorder here on Tuesday.
"Our utility bills have inflated by millions of rupees with a rise in energy cost per unit, said one miller who is planning to close down operations from Eid onwards. It may be noted that the availability of RLNG had brought a sigh of relief to the textile mills in Punjab early this year, as the generation cost had become at par with the gas-based energy generation in Sindh. Since the price of RLGN was linked to the Brent crude oil, which has jumped to $46 per barrel now against $30 a barrel in the month of March.
"The generation cost in Punjab has crossed Rs 10 per unit as compared to Rs 6 per unit in Sindh where electricity is being generated on locally available system gas," said a miller, already facing acute liquidity crunch due to multiple factors including duty on cotton import, dumping of yarn and fabric from competitors in domestic market, retrospective implementation of Gas Infrastructure Development Cess from 2011 and an undue appreciation of Pak rupee against dollar.
He said even the banks are not ready to cooperate with the individual mills in textile industry for having no return on capital. It is also worth noting that the Federal Commerce Minister, Khurram Dastgir Khan has suggested the prime minister that the government should provide energy to the textile industry at competitive prices and offset the effects of taxes on exports, which are currently non-refundable. The textile millers, requesting anonymity, have criticised the Federal Finance Minister Ishaq Dar for not responding to the crisis like situation in a constructive manner. "It is highly unfortunate that Dar is not ready to meet the textile industry delegation despite repeated requests," they added.
One former chairman of All Pakistan Textile Mills Association said that Prime Minister Nawaz Sharif had spent some five hours with the industry representatives on September 11 last year and partially resolved its issues with a promise to address the remaining ones on his return from New York. But no further progress has taken place on the subject since then despite repeated appeals.
Comments
Comments are closed.