The Value-Added Textile Export Industries of Karachi are deeply shocked and totally disappointed with the sitting Government for utter silence, indecisiveness and no response towards the appeal and SOS calls to the Prime Minister and his Economic & Energy Team with regards to lack of legitimate supply of gas to the industries on which the industries cannot operate causing colossal financial losses. The industries of Karachi have been deprived of its legitimate gas share for the last several decades. Prime Minister Shehbaz Sharif is following the footsteps of his predecessors and has totally ignored the industries of Karachi while on other hand he has been meetings with the Spinners Association of Punjab. Today, ECC of the Cabinet has also one-sidedly, without consultation and taking on board the stakeholder Textile Associations of Karachi, have approved one-sidedly to upward revise the rates of RLNG from existing price of USD 6.5 mmbtu to USD 9 mmbtu. While, indigenous gas being provided to the export-industries in Sindh province will be charged at Rs. 1,350/mmbtu (USD 6.6 mmbtu) with an increase of 65 percent and RLNG USD 9 mmbtu for SSGCL consumers which the industries of Karachi have termed “unjustified and unacceptable”. Relevant to mention here that the previous Government had approved RLNG USD 6.5 mmbtu tariffs for export-oriented industries across Pakistan but the same was implemented only in the SNGPL territory in north and despite of repeated requests and reminders it was never given to export-oriented industries in the territory of SSGCL whereby the RLNG industrial consumers were charged in January 2021 Rs 1361 per mmbtu which has been enhanced till June 2022 to Rs 4626 per mmbtu. Previous financial year, Government disbursed Rs 81 Billion against the subsidy to provide RLNG on Competitive Tariff in Punjab only. This financial year Government allocated Rs 40 Billion and these benefit were passed on to the export-industries in Punjab creating a competition between the export-industries within the country. The said subsidy is given from Taxpayers money and the successive Governments always forget that it is Karachi is engine of the economy and contributes in generation of highest revenue and taxes for the national exchequer which is passed on to all else depriving Karachi itself. Like previous Government, the sitting Government is also treating Karachi step-motherly with sheer discrimination.
The Value-Added Textile Exporters of Karachi want to know what are the ulterior motives behind such discrimination done by Government towards the export industries of Karachi? Whether the subsidy being given from taxes generated from all over the country is meant for Punjab province only? Karachi pays highest taxes but highest subsidy is given to Punjab Province. Should not the subsidy given to export sector is uniformly applied across Pakistan including Karachi? When this sheer discrimination and dubious conduct on part of the Federal Government will be stopped? The export industries of Karachi strongly condemn this repeated discriminatory move to favour the export industries of Punjab only which has also created unhealthy competition among the export industries in Pakistan and elsewhere, abroad. To facilitate exporters is the policy of the Federal Government for Punjab only? It is an irony that the industries have also been burdened for cross-subsidy given to domestic and fertilizer sector.
The Export-Oriented Industries of Karachi, mainly of the Value-Added Textile Exports are highly upset as to why this sheer discrimination is being done alone with Karachi which is the industrial and textile hub of Pakistan that generates 70 percent revenue for the national exchequer, contributes to 54 percent in total national exports and 52 percent in textile exports? They understand that they have been given punishment by reduced supply of gas against their success and accomplishment to enhance textile exports worth USD 4 billion this year and earning more foreign exchange. Out of this USD 4 billion Karachi has generated and contributed more than USD 2 billion. Still Karachi is suffering for the last 35 years due to no infrastructure, scarcity of water, power and gas, extortion, law and order situation, street crimes, civic and basic facilities.
In the present most difficult economic turmoil in the history of Pakistan only the export-sector is performing. The Value-Added Textile exports have unsurpassed and achieved milestone with historic enhancement in export and foreign exchange earnings by delivering beyond excellence and total national exports recorded to the tune of approx USD 31.76 Billion for FY2021-22 in which total textile export is worth USD 19.4 Billion with an increase 26 percent, worth USD 4 Billion. This new increase of 26 percent in value-added textile exports also tantamount to 26 percent enhancement in employment and as well revenue generation and taxes. Value-Added Textile sector is the only highest labour-intensive sector providing highest employment than the Government and any other sector. Provided the Government had ensured uninterrupted supply of energy/ gas, the export would have enhanced more than 26 percent. More than 40 allied industries of Textile have also excelled in their growth and performance.
However, due to lack of legitimate supply of gas to industries, mainly the Value-Added Textile Export Industries of Karachi and recent hike proposed in gas tariffs, the industrialists of Karachi have approached the Associations conveying their disappointment and apprehensions on loss of industrial production due to lack of gas supply and have expressed discontentment on indecisiveness by the Government in this regard. The industrialists have also expressed their concern as to why the industries of Karachi should alone bear the brunt of gas shortage? Industries have demanded for fair treatment by the Government and termed lack of legitimate gas supply as an “unconstitutional act”. They have demanded the Prime Minister to immediately intervene and accord immediate meeting with the stakeholder Value-Added Textile Associations in Karachi failing which the exporters being highly aggrieved, hopeless and disappointed shall be compelled to close down their industries and shift abroad. They also demanded to allocate 110 mmcfd gas of Ghotki allocated SSGCL as same quantum of 110 mmcfd fro Marri was allocated to SNGPL.
The Exporters of Karachi are highly distressed and a perception and feeling is emerging that nobody in the Government seems thoughtful of the situation and has not uttered a single note of care for the industries of Karachi! Are there any ulterior motives to purposefully target and victimize the industries of Karachi so they may shift elsewhere in Pakistan or abroad? The export industries of Karachi are also victimized and denied of other alternate fuel. Production of export industries which have no other alternate energy or power connection/ source but only gas/RLNG have completely shutdown. Several will be shutdown after Eid and many have been planning to shift abroad.
Amid continuous gas crisis in the country specially in Karachi and in view of contradictory moves by the Government towards its own business policies by depriving the exporters from level playing field and viable business environment, the Value-Added Textile Exporters from Karachi have constituted a Committee for due-diligence to shift Textile Export Industries elsewhere, on the exporters demand, to correspond and negotiate with those countries who have much better business and export friendly policies and are offering most attractive incentives to their foreign investors as well as their local industries. How industries can work out the basic raw material – gas and other basic amenities and utilities? Textile exporters were most disappointed and burdened with one adverse factor after another have been compelled to make plans to shift their business to such countries where they can work and expand their business with peace of mind and with honour.
This was articulated by Jawed Bilwani, Chairman, Pakistan Apparel Forum & Chief Coordinator, Value Added Textile Forum, Abdul Rehman, Chairman, Abdul Qadir Bilwani, Sr Vice Chairman, Faisal Arshad Sheikh, Vice Chairman, Pakistan Hosiery Manufacturers & Exporters Association, Kamran Chandna, Chairman, Pakistan Knitwear and Sweater Exporters Association, Shaikh Shafiq Jhokwala, Chairman, Pakistan Readymade Garment Manufacturers & Exporter Association, Kashif Mahtab Chawla, Chairman, Towel Manufacturers Association of Pakistan, Abdul Samad, Former Chairman, Pakistan Cloth Merchants Association and various other representatives and eminent exporters of Value-Added Textiles in a joint Press Conference held today at PHMA House, Karachi addressing the Prime Minister of Pakistan.
They added the export industries are saddened over such unwelcoming act and behaviour of the Federal Government who has shut eyes and ears over and silent over the SOS call and appeal. Besides, downfall in exports, even the national revenue shall face decline along with reduced inflow of foreign exchange but yet the Government’s silence is hither to break in order to come to a rescue as the industries of Karachi have also given solution to address the gas crises proposing to rationalize distribution of gas which is already available in the system. Why should the industries of Karachi alone bear the brunt of gas shortage? Prime Minister of Pakistan is appealed to take immediate notice of the highly aggravated situation as Karachi is the heart of Pakistan and driving force of the national economy. Exporters of Karachi also feel that whether Government want to destroy the exports and industry of Karachi which contribute 60% revenue for the Federal Government and 95% for the Provincial Government? Destroying exports of Pakistan tantamount to complete economic disaster and default.
Prime Minister of Pakistan Shehbaz Sharif, in the national interest, must take immediate cognizance of the situation and urgently respond to the Constitutional Right of the Value-Added Textile Exporters of Karachi to save the investment of industrialist and protect the soft and positive image of Pakistan globally, otherwise, if such alarming situation prevails, the country may face high unrest and uncertainty due to closure of industries in Karachi, shifting abroad, massive layoffs and drastic decline in the national exchequer further leading to chaos.