LAHORE: While expressing serious concerns over the threats of gas supply termination and notices of additional security payment by the SNGPL the Pakistan Hosiery Manufacturers & Exporters Association (PHMA) on Tuesday urged the government to withdraw these notices and ensure smooth gas supply to the export-oriented value-added textile industry so that the exports could not be suffered, which have just started to show a positive trend after a long time.
PHMA North Zone Chairman Abdul Hameed, in a letter to Commerce and Textile Minister Jam Kamal, has argued that at a time when the exports data have showed some growth the government agencies, instead of taking business-friendly measures, are creating hurdles for the exporters.
He quoted the latest exports data and said the exports of readymade garments rose 23.17pc by value in the first quarter and 16.16pc by quantity, while knitwear rose 14.13pc by value and 2.17pc by quantity while bed wear posted a growth of 13.31pc in value and a growth of 14.55pc in quantity, which is an encouraging sign.
The government should extend its full support to continue this positive trend of exports growth through uninterrupted gas supply to the captive power plants at affordable and competitive rates.
It is to be noted that the exports of textile and clothing recorded an increase of nearly 9.51 per cent in the first quarter of FY25 amid concerns that the industry was experiencing a slump.
The exports from the sector had a negative growth of 3.09pc in July, which rebounded 13pc in August and 17.92pc in September. Many experts believe that the textile sector may struggle to compete with regional rivals due to the implementation of harsh taxation measures in the current fiscal year. However, the disruption in supply from Bangladesh has also increased the demand for Pakistani garments.
The PHMA Chairman said that the textile and clothing exports have stayed the same in the last two years despite having a $25 billion installed capacity. According to textile exporters, exports from the same sectors have been static for the past two years due to structural issues. “We would like to bring to your kind notice an important issue which would hurt industrial units and their production activities.”
He said that the notices have been issued to our members having captive power facility, demanding additional security payment based on revision of share of system gas and RLNG (e.g. 25:75). These notices are not only unwarranted but also harsh steps, given the decision to terminate the gas supply from these members from Jan 1, 2025 and simultaneously serving notices for enhanced security.
“It defies logic that on one hand, the SNGPL is terminating the gas facility, and on the other, an additional demand of security is being raised. We request immediate withdrawal of these notices and ensure gas supply to industry so that exports do not suffer.”
Furthermore, the industry was disappointed with the decision to terminate the gas facility. He said that the exporters have invested heavily in setting up captive power plants, and this move will render their infrastructure redundant and their investment will be doomed.
“In the light of the Petroleum Exploration & Production Policy 2009, which aims to accelerate exploration and development programs, we believe that terminating the gas facility is counterintuitive. We request that these decisions may please be reconsidered and industry may be engaged to explore alternative solutions that may balance the interests of all stakeholders.”
He said that the PHMA hopes that the government will take its demands sympathetically and take immediate action through concerned ministry to address the concerns and to save the foreign exchange earning industry from collapse.
Copyright Business Recorder, 2024