Mr Kandhari said there was no justification in loadshedding by power utility when there was no total stoppage of gas. - File photo

KARACHI: Business and industry leaders have urged the government to appoint auditors to oversee cash flows of the Karachi Electric Supply Company (KESC) to avoid another circular debt.

Reacting to the power utility company`s recent decision to resort to eight-hour load shedding, which would affect two production shifts in all industrial estates, the leaders suspected some serious financial leakages in the KESC.

Site Association of Industry chairman Wahab Lakhani said when the power utility was regularly receiving utility charges from consumers, particularly business and industry, there was no reason it should face cash flow problem and stay fully dependant on gas for power generation.

He said under an understanding the KESC in case of shortage of gas supply is bound to ensure uninterrupted power supply by shifting to alternate fuel, which in this case is furnace oil.

However, he accused the KESC of destroying industry by saving its own funds on furnace oil.

The Pakistan Apparel Forum chairman Jawed Bilwani suggested that a formula should be evolved wherein payments to Sui Southern Gas Company could be made through the cash flows from current billings of the KESC.

He alleged that the power utility company resorts to such tactics to blackmail the government to get relief.

The city is confronted with law and order situation, Bilwani said, and added there will be further rise in unemployment with closure of industry due to prolonged loading shedding.

He recalled that the KESC in a letter dated August 17, 2011 had informed the ministry of water and power that all the industrial zones in the city were exempted from load shedding since last 18 months.

However, he challenged the statement of the CEO of KESC as completely false and misleading.

Korangi Association of Trade and Industry (Kati) chairman Johar Ali Kandhari said that as per agreement the KESC can not resort to loadshedding to the industry if gas supply was maintained at 160mmcft but the power utility in order to put pressure on government adopts method of dividing load- shedding in two spells as it will hurt the industry most.

He said that loadshedding causes millions of rupees production loss as well as increases cost of production of industry, which badly affects their competitiveness in the world market.

Mr Kandhari said there was no justification in loadshedding by power utility when there was no total stoppage of gas.