Severe energy crisis, rising markup rates badly hit textile industry: CGF chief

LAHORE: Severe energy crisis and rising markup rates have hit the textile industry, with reports of closure or non-operation of about 400 textile mills in Punjab after suspension of gas supply to the industry. The energy crisis also hit the power looms and sizing industry.

The whole cotton industry is in a state of shock. However, Prime Minister Shehbaz Sharif’s promise to provide gas and electricity at subsidized rates to the owners of textile mills after Eid-ul-Adha has caused a wave of satisfaction in the industry.

Chairman Cotton Ginners Forum Ehsanul Haq said that after two decades Pakistan’s textile industry was booming due to large export orders. The textile sector is now fighting for its survival due to the recent extraordinary rise in electricity and gas prices, record increase in mark-up rates and subsequent complete gas suspension. He said that the downward trend in cotton prices continued throughout the world including Pakistan during the last week during which the prices of cotton in Pakistan fell by Rs 6,000 per maund. While the price of Phutti in the last one and a half months due to the textile crisis and a sharp decline in international markets reached at Rs 6,500 per 40 kg from Rs 10,500 per 40 kg.

He also said that after many years, China has decided to buy three to five lakh tonnes of cotton from international markets for its state reserves. Cotton prices are on the rise all over the world, including Pakistan, and the New York Cotton Exchange has seen a rise in prices of up to four cents per pound due to the long-term upward trend in cotton prices. He further said that there were reports of severe damage to cotton crop due to heavy rains in all Cotton Zones of Sindh and Punjab.

Copyright Business Recorder, 2022