APTMA seeks withdrawal of increase in GIDC

APTMA'S Senior Vice Chairman Seth Muhammad Akber has urged the government to withdraw increase in Gas Infrastructure Development Cess (GIDC) to avoid a total disaster of the textile industry, specially the Punjab based textile units.
He was addressing a press conference on Friday at the APTMA Punjab office. Acting Chairman APTMA Punjab Syed Ali Ahsan, former Chairman APTMA Punjab Shahzad Ali Khan and Chairman All Pakistan Textile Processing Mills Association (APTPMA) Khalid Habib were also present on the occasion.
Seth Akber said increase in GIDC to Rs 150 will ruin the textile industry in Punjab, which is already facing unprecedented gas and electricity load shedding. He said an increase in the GIDC is also a negation of what the government had offered in budget to boost business activity.
Seth Akber lamented that the government has brought GIDC to zero level for the cement industry which produces major chunk of cement for local consumption and exports consignments worth 400 million dollars only. The textile industry exports, on the other hand, are 13 billion dollars, which have been burdened by the government with GIDC increase, he added.
According to him, the government should act prudently as the benefit of the GSP Plus status will also be mitigated with this increase in the GIDC.
He said the industry is already on the brink of collapse due to high energy tariff as well as its non-availability in the Punjab. He said the textile industry in Punjab is in doldrums due to energy shortage and increase in the GIDC will aggravate the adverse situation further.
He said no infrastructure development project has so far been surfaced in the government sector despite the fact that each textile mill was paying one million rupees per month on an average under this head.
Speaking on the occasion, former chairman APTMA Punjab Shahzad Ali Khan said the energy contributes heavily in the cost of doing business and it will become difficult to compete internationally with increase in the GIDC.
According to him, the energy cost is likely to increase by 10 percent with increase in GIDC that would be detrimental for the textile industry, particularly in Punjab.
Shahzad said some 100 mills in Punjab have closed operations totally while another 100 textile mills are operating partially. There is a chance of complete closure of another 100 textile mills if situation persists that would bring exports further down.
He said the textile industry cannot pass on this increase in GIDC in price of products unless the prices of regional competitors escalate.
APTPMA Chief Khalid Habib said the gas is like raw material for processing industry but partial supplies with low pressure is devastating the processing units in Faisalabad. He urged the Finance Minister to review the decision of increase in the GIDC immediately.