Govt to cut power tariff by Rs2 per unit for industrial sector
 

ISLAMABAD: The government is going to slash down the electricity tariff for the industrial sector by Rs2 per unit to Rs9 per unit from the existing Rs11 per unit with a view to bringing down the cost of doing business to make Pakistani products competitive in the international market. And to this effect, the Ministry of Water and Power has started working on the proposal to bring down the industrial tariff to Rs9 from the existing tariff of Rs11 per unit, and the summary may be pitched to ECC in the next meeting for approval, a senior official told The News.

However, market sources say that textile industry is **t happy with the decision of the government as it is asking for the reduction in power tariff by Rs4 per unit to Rs7 per unit as in the regional countries such as Bangladesh is providing the electricity to its industry at Rs7 per unit.

The government has taken this decision in a bid to increase the exports of the country as the decision to decrease the industrial tariff will help tumble the cost of doing business. Pakistan's exports have tumbled by 20 percent to $20 billion which stood at $25 billion in the era of Pakistan People’s Party.

By end of the outgoing fiscal, the trade deficit is going to end at $32 billion as the imports are likely to be at $52 billion. This means the currant account deficit is going to hover at over $ 9 billion. Independent experts are of the view that the government should come up with solid measures to increase the exports and the endeavours on the part of the government should be like, i) the clearance of refunds of Rs100 billion in one-go to the exporters to resolve the liquidity crisis, and ii) make assure the availability of affordable tariff at Rs7 per unit.

The textile sector wants the reduction of Rs3.50 per unit in the electricity bills which are being charged in the name of three surcharges. The Industry says:" We are being forced to pay for the inefficiencies, theft and losses the power sector is facing, and we have asked the government to reduce the cost of surcharges amounting to Rs3.50 from Industrial tariff. The industry also says that it’s being provided the costly gas at the rate of Rs1001 per MMBTU where as the Industry in Bangladesh is getting gas at the rate of Rs400 per unit. The textile sector also wants the gas tarrif at price of Rs400 per MMBTU.

The industrial sector says that existing electricity tariff of Rs11 per unit and gas tariff of Rs1001 per MMBTU has increased cost of dosing business by 35 percent which has made the products of export oriented industry in the international markets uncompetitive as the prices of Pakistan products are higher as compared to products of other competing regional countries.



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