High power tariff hampering industrial production: Arbi

KARACHI: President, SITE Association of Industry Muhammad Kamran Arbi has drawn attention of the government towards high industrial power tariff. He said that the high industrial power tariff is badly hampering industrial production and resulting in decline of exports.

Quoting KE’s Annual Report 2023, he said that due to high power tariffs, economic slowdown and low demand, KE’s units sent out dropped by nearly 8%. The drop in energy consumption, due to low demand and high tariffs impacted industrial production leading to a deterioration of exports by 4% ($280mn) during 1Q FY24 compared to last year.

SITE President said “Understanding the gravity of the matter and in a bid to give relief to industries, the government had already allocated a sum of rupees 45 billion as support in the budget on incremental use of electricity, which is still being provided to all industries, except those based in Karachi. This is clear discrimination with Karachi industries”.

He said “Similarly, Additional Surcharge PHL is being collected on KE bills for IPP Capacity Payments. KE produces its own electricity and only buys some electricity from the National Grid. This should also not be charged on the industrial consumers of Karachi”. He also demanded to end Peak hours’ tariff and non-Peak hours’ tariff as it was nonsensical given the nature of a manufacturing industry that relies on continuous production.

SITE President further said that due to increasing cost of production, the industries in general and exporting industries in particular, are facing difficulties in competing with neighboring countries in the international markets.

He has appealed the Caretaker Prime Minister Anwaar-ul-Haq Kakar, Energy Minister Muhammad Ali and Chairman NEPRA to immediately look into this unfair issue and resume the subsidy taking into consideration the difficulties being faced by industries.

Copyright Business Recorder, 2023