KARACHI:

Karachi Chamber of Commerce and Industry (KCCI), President, Iftikhar Ahmed Sheikh has expressed concerns over the significant surge in industrial gas tariffs under the caretaker setup. Since August 2023, the tariff has risen by 118%, escalating from Rs1,100 per mmBtu to Rs2,400 per mmBtu. Additionally, an extra 40% RLNG cost has been imposed, catapulting the gas tariff to an unprecedented high of Rs3,200 per mmBtu, marking a staggering overall increase of 191%. Sheikh highlighted that this surge, driven by IMF directives and other factors, has pushed industries in Karachi to the brink of closure.

Sheikh noted that the Petroleum Division, despite disagreements at a stakeholders’ meeting with the PM, issued a notification to SSGCL authorising up to a 40% charge for RLNG in industrial gas supply. He expressed concerns that these continual and exorbitant energy tariff hikes, coupled with the soaring costs of other industrial inputs due to unfavourable rupee-dollar parity, are jeopardising the viability of industries in Karachi.

Read SHC temporarily suspends gas tariff hike for textile industry

Warning of the impact on businesses, Sheikh mentioned that numerous industries have already ceased production, and many others are on the verge of closure. According to reports from Heimtextil 2024, Pakistani exporters are finding it challenging to offer competitive rates compared to their regional counterparts.

Published in The Express Tribune, January 13th, 2024.

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