KP textile mills express concern over hike in energy prices

PESHAWAR: Owners of textile mills of Khyber Pakhtunkhwa have expressed concern over drastic increase in the energy prices.

They are of the view that “it is the last nail in the coffin” of the ailing textile industry of the country in general and the provincial textile industry in particular.

In a statement issued to the print and electronic media after an emergent meeting of Khyber Pakhtunkhwa Textile Mills Association (KPTMA) convened specially to discuss the drastic increase in energy prices and withdrawal of regionally competitive energy tariff of Rs19.99/kWh and a gas tariff of Rs852/MMBTU for gas will result in complete closure of textile industry of KP.

KPTMA Chairman Afan Aziz said the export-oriented textile industry would be badly hit due to reversal in policy of the already committed energy tariff. He further said 60 percent of the industry was already closed and the remaining 40 percent would be closed due to that act of government. The textile industry would lose all export orders due to higher regional competitions and due to increase in energy prices for which industry was not ready at all, he added.

KPTMA Chairman alongwith Vice Chairman Mohammad Kamran Shah in their statement said that export-oriented textile industry was the largest job provider and earning much needed billions of US dollars annually. Due to high energy prices, the textile industry will not only lose their market share in the international market but it will lead to closure of many units. Closure of the industry would lead to massive unemployment resulting in a law & order situation on one hand and loss of export market share and much needed foreign exchange on the other hand.

KPTMA Chairman further added that energy was a key source of economic growth. Higher costs of electricity and gas directly hurt export-oriented textile industry as they are the key inputs in the production.

In addition to pushing up inflation, the big rise in energy prices will reduce real GDP and productivity. Higher energy prices have contributed to painfully high inflation, forced factories to curtail output or even shut down and slowed economic growth to the point that countries heading towards severe recession.

They humbly prayed for restoration of already committed energy tariff and release of stuck up sales tax, income tax and DDT refunds to use as working capital.

Copyright Business Recorder, 2023