APTMA rejects gas price hike

LAHORE: Chairman All Pakistan Textile Mills Association (APTMA) Mr. Abdul Rahim Nasir on Friday rejected sudden hike in gas prices from $6.5/mmbtu to $9/mmbtu for export oriented units, a statement said.

He said the upward revision in gas tariff is in contradiction of commitment given by the federal government for continuous supply of gas/RLNG.

According to him, a comparison of gas tariff in the region with Pakistan in a study conducted by The Pakistan Institute of Development Economics (PIDE) suggests that gas to the export-oriented sector is available at $4.05/MMBTU in Bangladesh and $5.19/MMBTU in India.

In the textile sector, he said, the component of energy costs account for roughly 18% of final product value.

“An increase of $2.5/mmbtu would result in around 5 per cent hike in the final cost,” Nasir added.

He said the industry delivered to the nation by investing Rs450 billion in machinery for capacity enhancement as per commitment, which has resulted in an increase of $500 million in exports each and every month in FY22 so far.

But, he stressed, the new projected investment of $5 billion, setting up of 100 new plants and addition of at least 500,000 new jobs with 90 per cent of them in Punjab would all be jeopardized.

He acknowledged that the Regionally Competitive Energy Tariff (RCET) provided by the current government over the past 3 years yielded outstanding results.

Speaking on the occasion, Chairman Northern Zone Mr. Hamid Zaman said the price hike would lead to large scale closures and unemployment.