Lahore, May 17, 2012 (PPI-OT): Pakistan has become the only non-oil producing country in the world where bulk of the electricity is being produced through oil run power generators that has kept the energy rates volatile to the extent that it is fast crushing the economic activity.
Severely criticizing another 16 per cent hike in power tariff, the LCCI President Irfan Qaiser Sheikh said that it is a futile exercise and would not be doing any service to the government unless and until it makes a plan to cover inefficiencies in the power sector.
Irfan Qaiser Sheikh said that besides controlling line losses and electricity theft, the government would have to chalk out a plan to convert oil based power generators to coal as in India more than sixty per cent of electricity in being produced through coal and what it is getting through furnace oil in not more than six per cent.
The LCCI President opined that government move is bound to increase the incidence of electricity pilferage that already is 25 per cent of the 22 per cent line losses and eating up Rs 50-75 billion.
The LCCI President said that how the industry would remain competitive at such a high price of electricity which is one of the basic industrial raw materials. We already have the highest tariff in our region as in India, the electricity tariff for industry is 10.5 cents, in Bangladesh 10.75 cents and in Sri Lanka it is again 10.75 cent whereas in Pakistan tariff is already 15 cents meaning that 45 percent higher as compared to the region. With this massive and unprecedented increase, we will have double the tariff of electricity what the regional countries are offering to their trade and industries leaving Pakistan totally uncompetitive and unviable in the international market place.
“The country had already lost a number of international markets to China, Bangladesh and India due to high cost of doing business and the decision to increase power tariff would make the Pakistani goods more uncompetitive.”
He said that the business community was unable to understand that instead of taking measures to control line losses and enhance cheap power generation up to capacity, the policies are being evolved to add to the miseries of the business doing people.
Irfan Qaiser Sheikh said that negative growth witnessed by the Large Scale Manufacturing sector was indeed an eye opener and a wake up call to the government. He said that the industry needs cheaper electricity to keep the units operational and to complete the export orders well within the given timeframe but only because of the shortage of electricity the exports are not up to the mark.
For more information, contact:
Lahore Chamber of Commerce and Industry (LCCI)
Lahore -54000, Pakistan
Tel: +9242 111 222 499
Fax: +92 42 636 8854