Industrialists have urged the government to give priority to the industries of Karachi in gas supply, as the city contributes more than 54% to national exports, provides the highest urban employment and generates maximum taxes.
In a joint statement following a meeting on Friday, the industrialists were of the view that the zero-rated export sector should be placed on first position in the natural gas load management policy, followed by general industries, commercial, domestic and other consumers.
Globally, the export sector was given first priority in economic activities, they pointed out and lamented that the government had kept five zero-rated export-focused industries in second position in the gas load management policy.
The major exporting industries should be given first priority and general industries should be put at second place in the priority list, followed by commercial, domestic and other consumers to increase production and enhance exports, they said.
The meeting was attended by Businessmen Group Chairman and former Karachi Chamber of Commerce and Industry (KCCI) president Muhammad Zubair Motiwala, Businessmen Group Vice Chairman and former KCCI senior vice president Muhammad Jawed Bilwani, KCCI President Muhammad Idrees, SITE Association of Industry President Abdul Rasheed and former SITE Association president Saleem Parekh.
In comments to The Express Tribune, Al Habib Capital Markets analyst Sunny Kumar suggested that the government should give preference to the export sector, considering the current economic situation of the country.
“Exports need to be increased to stabilise the rupee against the US dollar and to increase foreign exchange reserves,” he said.
Along with the export industry, domestic consumers should also be given priority, he emphasised, adding that recently the government had made a good decision, which offered a flat rate for additional consumption of electricity. “This will also reduce some gas consumption,” he pointed out.
AHL Head of Research Tahir Abbas was of the view that the government should focus on competitiveness of the export-oriented sector to achieve long-term, sustainable growth in the country’s exports, which would result in narrowing down the trade and current account deficits.
The government should rationalise gas tariff for each consumer including the domestic households, he said.
Local gas production had been on a continuous decline from 4 billion cubic feet per day (bcfd) in 2019 to 3.3 bcfd in 2021, he said, adding that with depleting gas reserves, the government should encourage electricity demand, as the country had surplus electricity capacity and discourage domestic consumption of gas.
Published in The Express Tribune, November 6th, 2021.
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