ISLAMABAD: While expressing concerns about the continuation of cross-subsidy, the All Pakistan Textile Mills Association (APTMA) has sought time from caretaker ministers for finance and energy to discuss the RLNG/gas supply and pricing, especially for the winter months.
In letters to both caretaker ministers, APTMA Executive Director Shahid Sattar has stated that recent media reports have suggested that the government has decided that cross-subsidies to unproductive sectors of the economy will continue to be included in power tariffs for the export sector.
“We express our deep concern about this, as it is contrary to our shared goal of achieving a robust economic recovery,” he added.
According to the APTMA, countries compete for export orders on the basis of cost and value for money, and export sectors around the world are not subject to various kinds of taxes and duties, adding that cross-subsidies and stranded costs as such are taxes and including them in power tariffs for exporters renders exports uncompetitive, causing a deterioration of key economic indicators, balance of payments, and an increase in unemployment.
The APTMA has also shared details of the economic implications of high power tariffs for exporters and possible solutions.
“Over 50 percent of the industry’s energy needs are currently met through RLNG/gas. Given the high-power tariffs and uncertainty surrounding availability and pricing of RLNG/gas, this is making it difficult for exporters to book orders,” Shahid Sattar maintained.
He further stated that the industry requires clarity on RLNG/gas supply and pricing, especially for the coming winter months as this coincides with a surge in demand for clothing in Western markets.
To plead the case for exports, a delegation of industrialists from leading business houses from across the country and the textile value chain, intends to meet both ministers on October 5, 2023.
Copyright Business Recorder, 2023