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Textile sector could see export-loss of $1bn due to suspension of energy: APTMA

  • Govt has suspended supply of gas and RLNG to industry from July 1 to July 8
  • APTMA says six-day Eid holidays mean industry will not function for 15 days during the month
Published July 1, 2022

All Pakistan Textile Mills Association (APTMA) on Friday urged Prime Minister Shehbaz Sharif to restore gas and RLNG supply of the export-oriented industry on an urgent basis, stressing that a loss of almost $1 billion in exports would take place, resulting in further damage to the economy.

In a letter to PM Shehbaz, Dr Gohar Ejaz, Patron-in-Chief APTMA, said the textile Industry achieved record exports during fiscal year 2021-22, clocking in at nearly $20 billion from $12.5 billion just two years ago.

APTMA urges govt to ‘fully’ support export-oriented industry

“This growth was enabled by implementation of Regional Competitive Energy Tariff (RCET), investment of over $5 billion in expansion and establishment of 100 new textile units resulting in enhanced export capacity of $500 million per month,” read the letter.

APTMA said that it is "inexplicable that the exporting sector, which has the capacity to deliver over $2 billion in exports per month, is being denied energy/gas". Consequently, exports will be significantly lower, much to the detriment of Pakistan's economy.

“Gas/RLNG to the industry has been suspended from July 1 to July 8, following that, there would be Eid holidays from July 9-14, and a shutdown of 15 days will translate to a loss of at least $1 billion,” said the country’s largest industrial body.

It apprised the premier that more than 50% of output will be lost this month, “with the very real risk of losing orders on a permanent basis as well as loss of repeat business due to delays in delivery of orders”.

GSP Plus: EU mission meets APTMA team

“If this momentum is lost due to energy supply and cost constraints, Pakistan will be forced to seek an additional $6 billion in loans from abroad, which under the circumstances may not even be possible,” stated APTMA.

Gohar said that the textile sector has repeatedly delivered its commitment and proven that they are a viable and long-term solution towards economic stability.

“(Therefore,) under these circumstances, we request that the gas/ RLNG supply of export oriented industry may kindly be restored immediately.”

The suspension in power comes as Pakistan faces issues on multiple fronts, resulting in a failure to secure the LNG cargo for July. In a press conference on Friday, Prime Minister Shehbaz Sharif also said that Pakistan did not opt to go for an expensive LNG cargo because it wanted to conserve its foreign exchange reserves.

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