Syed Wahaj Ahmed
Industrialists of Karachi have announced a complete shutdown of all seven industrial zones on Monday (Dec 4), while demanding the approved gas rates of Rs1,350 per mmBtu (million British thermal units) by the Oil and Gas Regulatory Authority (Ogra) must be implemented immediately.
They said only Karachi exports $47.69 million (Rs13,754 billion ) per day and if they (exports) are stopped, they will bring about a major loss to the national economy in this economic crisis. They said about 1.6 million to 1.7 million workers are working in all seven industrial zones and 30 percent of a total workforce are doing their jobs in the zones as daily wage earners, the complete closure will deprive hundreds of thousands of labourers of their decent living.
“After a long series of demonstrations and press conferences, now we announce a complete closure of all industries on Monday (Dec 4), if our legitimate demand of supplying gas Rs1,350 per mmBtu is not met by the government.
The new gas tariff has burdened industries with cross subsidy for undue favour and unfair support to fertiliser, domestic and power sectorr. The industry pleads for fair gas tariff of Rs1,350 per mmBtu and would never accept the unbearable gas tariffs ranging from Rs2,100 to Rs2,600 per mmBtu which have been imposed to please the fertiliser, domestic and power sectors and terribly penalise the industrial sector of the country that forms the backbone of the country’s economy,” Businessmen Group Vice Chairman Jawed Bilwani who is also Karachi Chamber of Commerce and Industry (KCCI) former senior vice president, said this while speaking to journalists at a presser at the office of Site Association of Industry (SAI) on Thursday.
He said in the country, gas to fertiliser sector is being provided at a much lower rate which was not making any sense as this was a sector which enjoys a profitability of around 20-22 percent and Rs40 billion and it also receives a subsidy in the gas tariff which was quite strange and beyond anyone’s understanding.
He apprised media that all the trade bodies of Sindh and Balochistan endorsed the strike call given by the KCCI in collaboration with all seven industrial zones including Site Association of Industry (SAI), Site Superhighway Association of Industry (SSHAI), Korangi Association of Trade and Industry (KATI), Landhi Association of Trade and Industry (LATI), Federal B Area Association of Trade and Industry (FBATI), North Karachi Association of Trade and Industry (NKATI) and Bin Qasim Association of Trade and Industry (BQATI) (formerly Port Qasim Association of Trade and Industry, PQATI).
Bilwani said unjustifiable and unprecedented hike in gas taiffs have made industrialists of Sindh and Balochistan distraught as they are unable to keep the wheels of industries running in this testing time.
He said the business community is appealing to the government to bring down gas tariff to Rs1,350 per mmBtu which has been determined as 100 percent cost of gas by Ogra, including approximately 22 percent profit of the Sui Southern Gas Company (SSGC) as well. The industries are poised to pay Rs1,350 per mmBtu without paying for the subsidies being provided to other three sectors, fertilizer, domestic and power at all.
SAI President Muhammad Kamran Arbi said the new gas tariffs which are simply unbearable could just close industries and bring about unemployment in the port city. He said the government should take notice and bring the tariff to the previous one, determined set by the Ogra. He urged the government to hold a meeting with the industry stakeholders to reach a consensus on the gas price since the existing tariff has outgrown the manufacturing costs.
He said the business community is waiting for the promised winter package for incremental consumption of electricity and it was already agreed to provide electricity at the reduced tariff of Rs20 per unit on incremental consumption during four months of the winter season.
KCCI Senior Vice President Altaf A Ghaffar said the industries of Karachi were already suffering from a high cost of manufacturing. Therefore, the government must immediately withdraw the hike in gas tariff and bring it down to an acceptable level i.e., Rs1,350 per mmBtu. He said all industries of the business hub of the country have come at the verge of a complete collapse as there is no time to lose and the government must accept the legitimate demand of the industrialists.
SAI Chief Coordinator Saleem Parekh said closing Small Medium-Sized Enterprises (SMEs) following big industries could stop exports of the country. He said the industry players have left no stone unturned to seek help from the government in this regard, but all their efforts went futile. The country’s economy will see a loss because of halting exports, he warned and said the industry is unable to fetch higher prices for their products on the world markets because of the costlier gas.
