APTMA decries gas tariff hike, labels it "Anti-Export"

January 27, 2025 (MLN): The All Pakistan Textile Mills Association (APTMA), Southern Zone, has criticized the Economic Coordination Committee's (ECC) recent decision to raise the gas tariff for Captive Power Plants (CPPs) from Rs3,000/MMBTU to Rs3,500/MMBTU.

Mr. Naveed Ahmed, in a statement issued to the print and electronic media, said that the recent 16.7% increase in gas tariffs for industries with Captive Power Plants using gas for electricity generation is a significant blow to the export-oriented textile industry.

He added that the sector is already struggling with numerous challenges in both the domestic and international markets, according to the press release.

He stated that the textile sector, which is the backbone of the country’s exports, not only generates crucial foreign exchange but also provides employment to millions of people, both directly and indirectly.

Mr. Naveed Ahmed said that due to an astronomical 311% increase in gas tariffs over the last two years, the export-oriented textile industry is becoming uncompetitive in the international market.

He added that with the highest energy costs in the region, along with high borrowing costs and taxes, Pakistani textiles will struggle to compete globally.

Hence, the recent decision to increase gas tariffs for CPPs will not only hinder the achievement of the export growth target set by the Prime Minister under the Uraan Pakistan Program but also risk losing hard-earned export markets.

Mr. Naveed Ahmed said that the industry has invested billions of rupees in gas-based power generation plants to ensure uninterrupted electricity for their own consumption.

This is because electricity suppliers in Sindh and Balochistan, such as K-Electric and HESCO, lack the capacity and capability to provide the required load of uninterrupted electricity to the industry.

He further stated that the government is pushing for the use of grid electricity instead of power generated by gas-based Captive Power Plants, without acknowledging that this policy is unfeasible in Sindh and Balochistan due to the poor capacity and inconsistency in grid electricity supply.

He noted that the government has increased the gas tariff of CPPs only, and all other sectors including fertilizer, processing and domestic have been left unchanged.

This targeted discrimination is not acceptable and hence rejected.

Mr. Naveed Ahmed demanded the federal government to reverse its decision of unprecedented increase in gas tariff to make textile exports competitive in the international market which is being continuously eroded by surge in energy prices during last two years.    

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