Petroleum products: 'fresh increase to prove catastrophic for economy'

New hike in Petroleum products would drastically increase the cost of production of exportable goods which would become unacceptable to foreign buyers. This will create multiple problems for overall economy and badly hit particularly the industrial sectors apart from adding untold miseries to the common man, said Wasim Latif, Chairman and Adil Manzoor Ellahi, Vice Chairman Pakistan Textile Exporters Association(PTEA) while talking to newsmen.
Government has taken an anti-business decision by increasing the prices of petroleum products at a time when the economic activities were already shrinking due to multiple factors and this hike will produce overall damaging impacts on the economy, they said.
Entire industrial sector was already facing different internal and external challenges and the recent increase would further aggravate the economic situation. Country's 70 percent electricity is produced through thermal power plants where oil has a major role and hike in petroleum prices will lead to increase in electricity prices as a result of which prices of all commodities would shoot up, they apprehended. They said that this would cause more inflation and poverty, increasing transportation cost, creating more difficulties for the common man and destroying the entire industry.
Wasim Latif said that International market demanded quality products to have competitive edge for which Pakistani exporters needed due encouragement and facilities. There was a need of avoiding such harmful steps for the best interest of the business community particularly in the present era of competitiveness, he added. He warned that the fresh increase would prove catastrophic for the national economy as business activities will be minimised, exports will decline and increase in prices of consumer products will severely affect the buying power of common man. How the government will achieve export targets by making inputs more costly, which are key factors in production activities, he questioned. He said that when oil prices come down in international market, government makes a meager cut in petroleum prices to ruse the people, but when oil prices go up, total impact of spike is passed on to the public which is an unfair treatment.
Adil Manzoor was of the view that industrial sector is already facing negative growth and hefty hike in petroleum prices will severely hit it due to increase in cost of production. Textile exports are facing tough competition in international markets on account of high production cost and this increase will make our products less competitive. It will also cause closure of more industries, as industrial sector will not be able to absorb this shock leading to more unemployment and poverty in the country.
He said that energy shortage is badly affecting business activities due to which many industrial units have closed down their operations, rendering thousands of workers jobless and government should explore renewable energy resources to overcome energy crisis in the country.
PTEA leaders stressed upon the government to work out long term plans for energy solution and revenue generation instead of resorting to unwise short cuts that will have long lasting negative impact on overall economy. They said that frequent increase in gas, power and petroleum prices will accelerate the capital flight from the country and will discourage local and foreign investment. They urged government to take back this decision to save economy from further damage.