INDUSTRIALISTS of Karachi have announced a strike on December 4 to protest against the whopping and unaffordable gas tariffs, which have rendered all seven industrial zones of the port city unviable and uncompetitive. Other industrialists and trade bodies of Sindh and Balochistan including the Lasbela Chamber of Commerce and Industry, Nooriabad, Kotri and Hyderabad had expressed their solidarity and fully supported a complete shutdown. They have called for a reduced gas tariff of Rs1,350 per million British thermal units (mmBtu) as determined by the Oil and Gas Regulatory Authority (OGRA).
There were healthy signs on the economic front because of the policy and administrative measures initiated by the government with the active support of the Pakistan Army. The reported economic growth of 2.1% in the first quarter of the current financial year, stability of the exchange rate and the fastest growth shown by the Pakistan Stock Exchange, which hit a record high of over 61,000 points, indicated that the economy was on the right course. However, it is also a fact that repeated upward revisions in electricity and gas tariffs are threatening the progress made as rising production costs are making our products and exports uncompetitive in the global market. The demand of the industries of Karachi is justified as the tariff determined by OGRA took care of 100% cost of gas including around 22% profit for Sui Southern Gas Company (SSGC). Industrialists believe that the tariff for them has been increased mainly because of cross-subsidies in favour of domestic, power and fertilizer sectors. There might be justification for subsidies for these sectors but it would not be a prudent approach to put additional burden on the industry at the cost of loss of exports and foreign exchange. Closure of factories would not only be a loss for investors but also a severe blow to the economy of the country. Therefore, the government must hold dialogue with representatives of the business community and sort out the issue amicably to their satisfaction.
