Energy woes can lead to closure of more units: LCCI

RECORDER REPORT

LAHORE: The Lahore Chamber of Commerce and Industry (LCCI) has warned the government of more industrial closures in the Punjab if it fails to stop power outages and restore supply of gas to the industry.

While talking to Business Recorder, LCCI former Senior Vice President Abdul Basit demanded of the government to impose financial emergency that has become inevitable following a change in the IMF’s present policy towards Pakistan who denied either providing a new loan or rescheduling the previous ones. He said that the country’s default-like position was the direct outcome of the continued energy crisis.

The unprecedented power and gas load shedding had adversely impacted industrial production, which in turn not only created unemployment but also caused a decline in revenue.  He further said that the government should take concrete steps to improve the financial health of the country. He suggested that the NTN should be made mandatory for the membership of any trade body and renewal should be subject to filing of tax return. He was of the view that discretionary powers of the tax officials should immediately be abolished besides revamping the assessment procedures so that no one can evade tax.

Abdul Basit also stressed the need for holding all parties conference (APC) on the national economic situation while economists, experts and leading industrialists should also be invited so that national consensus could be developed to bring the country out of the financial crisis. He was of the view that the much needed cheaper energy could be generated through the hydel power system to bring the cost of business down. The cheaper electricity could also induce fresh investment in the country, he maintained.

Meanwhile, the LCCI President Farooq Iftikhar, Senior Vice President Irfan Iqbal Sheikh and Vice President Mian Abuzar Shad held a meeting with the office-bearers of Trade and Industrial Associations who called on them here at the LCCI on Saturday.

Business leaders from a number of trade and industrial associations, including Lahore Township Industrial Association, Ferozepur Road Industrial Association, Katarbund Road Industrial Association, Kahna Kacha Industrial Association, Anjuman-e-Tajiran Pakistan, Qoumi Tajir Ittehad, Anjuman-e-Tajran Badami Bagh Auto Market, Township Traders Association, Pakistan Auto Parts Manufacturers and Exporters Association, Anjuman-e-Tajran Urdu Bazar, Brandreth Road Traders Association were prominent among the participants who had meetings with the LCCI office-bearers.

After listening to their point of view, the LCCI President said that the government would not be able to control the situation triggered by the demonstrations and strikes called by the angry industrial workers against their retrenchments as a result of gas suspension and power outages. “Industrial productions had already gone down by fifty percent in the province of Punjab only because of gas and electricity suspension and the remaining was paying a very high cost for keeping the industry wheel turning.”

Farooq Iftikhar said that the situation today had reached the point that International donors had started showing their reluctance in rescheduling Pakistan loans. He said that the industry needs a continuous supply of electricity to complete the export orders well within the given timeframe but only because of the shortage of electricity, exports were not up to the mark.

He said that Pakistan had already a lost a number of international markets while the condition of both local and foreign investment was also precarious. He said that cheaper and uninterrupted power supply was the only way to achieve economic targets set for the year 2013 but neither the government was sharing its future plans, nor paying any heed to the difficulties being faced by trade and industry in Punjab.

He said that it was astonishing that on the one hand the government was talking of economic stability in 2013 while on the other hand they were not revealing any roadmap to achieve this goal. He also feared a surge in street crimes, saying that the law and order situation is bound to aggravate in the coming days as repeated power outages in the industrial estates was increasing unemployment and particularly hitting the daily wagers.

He said that the most industrial units had reduced their working to single six-hour shift from the previous three shifts system. This had led to increased level of raw-material wastage leaving production process non-profitable. Now the leading industrial units were experiencing losses despite being managed professionally. The crisis in the industrial sector was causing flight of capital and relocation of industrial units to countries like Bangladesh and Malaysia. He urged the President and Prime Minister to take notice of this grave situation and act promptly to save industrial and social fabric of the country.