Two industrial giants of the port city of Karachi have hailed the government’s decision to fix the industrial electricity tariff at nine cents per unit, which they believe will give a big boost to the industrial growth countrywide, reports WealthPK. “This move is anticipated to bring about a cut in the production costs for industries, reinstating their competitiveness in the global market,” said Nighat Awan, Acting President of Korangi Association of Trade and Industry (KATI) – one of the two big industrial associations in Karachi. Awan highlighted the positive implications of this initiative, emphasizing its potential to contribute to the economic stability and developmental trajectory of the country. The reduction in the electricity costs is seen as a crucial step to foster a more conducive environment for industrial growth. The KATI acting president praised the caretaker government’s efforts for rehabilitation and development of industries.

Awan expressed optimism that this strategic decision would not only promote industrialization but also decrease gas consumption, subsequently alleviating the burden of capacity charges and addressing the persistent issue of circular debt. Awan drew attention to the challenges faced by the industrial sector, particularly in terms of export competitiveness. With electricity previously priced at 16 cents, the industries struggled to compete with imports, resulting in a surge in imports and a concerning decline in exports. Awan emphasized that KATI originally reduced power tariff to 9 cents, underscoring the importance of providing an affordable and uninterrupted power to stimulate production. The KATI acting president outlined the multifaceted benefits of this decision, predicting increased production, heightened power consumption, timely bill payments, and a reduction in circular debt [in the energy sector].

Awan said that KATI stood ready to fully support this initiative, expecting a positive ripple effect on productivity in various industrial zones, including Korangi. She appealed for the government to urge swift implementation of the decision. This, she believed, will not only bolster exports but also contribute to curbing inflation, marking a crucial step towards sustained economic growth and competitiveness in the global market. Muhammad Kamran Arbi, President of SITE Association of Industry, another largest association of the city, welcomed the federal government’s decision to allow power tariff at 9 cents/kWh to the industrial consumers and urged the government to notify the same immediately. He said power tariff reduction to 9 cents/kWh will not only help restore industrial competitiveness and reignite the economic engine but also go a long way toward boosting the confidence of industrialists.

Such a move will boost exports across all sectors and stimulate a large number of downstream industries and services, which will ultimately create more jobs, increase foreign exchange earnings and ensure an overall stable economic growth. Kamran Arbi underscored the need to provide a competitive and growth-led environment to the industries and termed it ‘imperative in the prevailing economic situation’. He opined that a regionally competitive energy tariff was the need of the hour to arrest the declining morale of industrialists as well as decline in the value-added exports.

Credit: Independent News Pakistan (INP)