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Karachi, The Karachi Chamber of Commerce & Industry (KCCI), along with all seven Industrial Town Associations and Value-Added Textile Associations, has made a strong appeal to the government to reduce the gas tariff to Rs1350 per MMBtu, which is the 100 percent cost of gas as determined by OGRA. This appeal comes in the wake of the business and industrial community’s readiness to pay the full cost of gas but not the subsidies.
According to Karachi Chamber of Commerce & Industry, the recent significant hike in gas tariffs has caused deep concern among the business and industrial sectors. The KCCI President, Iftikhar Ahmed Sheikh, along with other representatives, expressed that the increased tariffs are leading to more complications rather than providing solutions. Anjum Nisar, Vice Chairman of the Businessmen Group (BMG), emphasized that the business community’s demands would escalate to more intense protests, including observing no export days, if the government fails to respond. He warned of intensifying these protests if there is no reduction in gas tariff announced by the first week of December.
The press conference also addressed the issue of a 100 percent cash margin condition on imports, which has resulted in increased financial charges for the industries. The business community is particularly concerned about the unfair and heavy gas tariffs ranging from Rs2100 to Rs2600 per MMBtu, imposed to favor sectors like fertilizer, domestic, and power, at the expense of the industrial sector. Comparatively, the gas tariff for the fertilizer sector in neighboring countries is much lower, and yet, in Pakistan, this sector receives subsidized gas tariffs despite significant profitability.
The KCCI President highlighted the potential negative impacts of the government’s current approach towards gas supplies and tariff increases. These include the potential closure of industries, job losses, and serious law and order challenges. He also emphasized that the industries in Karachi are already facing high manufacturing costs due to several factors, and the increased gas tariffs only exacerbate these challenges.
The press conference saw the attendance of representatives from various associations and industries, all unified in their demand for the government to take immediate action to reduce the gas tariff to Rs1350 per MMBtu, in light of the serious implications for the industrial sector in Karachi.
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