Pakistan Hosiery Manufacturers & Exporters Association (PHMA) on Monday warned the government of a 'detrimental' effect on the country's export oriented sector with the falloff of OGRA's proposed gas tariffs increase up to 30 percent for industries.
In a letter to caretaker Prime Minister, Justice (Retd) Nasir-ul-Mulk, the PHMA sought a separate reduced gas tariff for export orientated industries to compete with regional nations on the world markets. A copy of the letter, which the Business Recorder was provided with on Monday, the association also demands of the government to ensure gas supplies to the industries uninterrupted. It showed concerns that the proposed move will make the exports costlier against the key competitive nation like Bangladesh and India.
It said that the export oriented industry is already facing multiple challenges in the wake of high cost of manufacturing, exorbitant utility tariffs, high labour wages etc., comparing to the competitors on the world markets. Comparison of gas price of Pakistan with regional competing nations: the Gas/MMBTU including GIDC inputs of Pakistan, Bangladesh and India is $6.59, $3.22 and $4.66. Electricity/kwh is $0.10, $0.09, $0.09. Water Tariff/per 1000 gallons is $0.50-2.00 Free (Well Water) and Wages per month is $123.45, $65, $140 in Pakistan, Bangladesh and India.
The textile export sector is entirely documented with the FBR under Five Zero Rated Export Sectors regime. "On request of exporters the Government declared Five Zero Rated Export Sector as there is no tax on export goods for foreigners and Government failed to pay refunds to exporters. Therefore, Separate tariff of Gas can easily be announced for Textile Export Sector," the letter said.
The association requested to the premier to direct the concerned authority to introduce a separate gas tariff slab for textile export oriented industries and avoid any increase in the key input rates. Rather, it demands of the premier to scale back the gas rates to those of placed in the regional competing nations.