KARACHI, July 1: Consumers and representatives of trade and industry have severely criticised the unprecedented hike in gas tariff and termed it a death warrant for the country’s productive units.
Local traders and transporters have called an emergency meeting on July 4 to decide the future course of action following the hike in the prices of petroleum products and gas.
Reacting strongly to the June 30, 2008 notification of the Oil and Gas Regulatory Authority (Ogra), the president of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), Tanvir A. Shaikh, said that the sky-rocketing prices of oil and gas would affect the cost of energy and the cost of production of exportable goods as well.
He said that it would also hamper the competitiveness of the industry in the international market. Mr Shaikh said that if at all the gas and LPG prices were to be increased it should have been staggered over a period so that common man as well as the commercial and industrial consumer would have absorbed it.
The FPCCI president said that the economy of Pakistan was not in a position to absorb such sudden and large shocks. He was of the view that a gradual hike in gas prices would have been much appropriate for the economy of the country.
He strongly urged the government to withdraw the increase at least from the captive power projects otherwise; the industrial sector might have to exercise the option of closing down factories, which would result in unemployment and labour unrest.
The government has increased gas prices by 31 per cent and that of the Compressed Natural Gas (CNG) by Rs13 per kilo. It is worthy to note that CNG prices have been increased thrice during the current year. The first hike in the CNG prices was made in January by 6 per cent (Rs2 per kilo), and then in March by 7 per cent and now the government has increased the price by Rs13 per kilo.
A 68 per cent increase in gas prices for captive power plants shall tantamount to the murder of the industrial especially the textile industry which is the backbone of the country’s exports.
The KCCI president, Shamim Ahmed Shamsi, and its former president, Zubair Motiwala, were of the view that at a time when the industry was not doing good and was already in doldrums, exports going down, unemployment figures at an all time high, cost of doing business and cost of manufacturing at its peak, the step to increase the tariff of gas, which otherwise was indigenous raw material and to compare it with the world oil prices was a big mistake on the part of government.
This hike would definitely increase the price of every commodity in the local market and would put us in a position where it would be impossible to compete in the world market, with special reference to textile, which according to them, was the mainstay of the country’s exports, the largest engine of employment generation and a major foreign exchange earner.
Transporters slam hike
The leaders of the National Transport Ittehad, Karachi have strongly condemned the government’s decision of increasing the prices of CNG and LPG by Rs13 and Rs3 per kilo respectively, PPI adds.
In a statement issued on Tuesday, the NTI leaders, Saleem Khan Bangash, Raja Mohammad Rafiq, and, Nazir Hussain, said that the increase in the gas prices was unjustified and anti-people, which needed to be strongly condemned.
They said that the government had raised prices of petroleum products on the pretext of price-hike in the international market but there was no justification for the enhancement in the gas prices, which was a local product.
The rise in gas prices had exposed the government’s claims of taking steps to check the rate of inflation in the country, the KTI leaders remarked.
The transporters said that the increase in the CNG and LPG prices would have an adverse affect on the operators of rickshaws, buses, taxis, pickups, coaches and mini-buses etc.
They asked the government to withdraw the hikes in petrol, diesel, LPG and CNG prices or allow the transporters to increase fares otherwise transporters would be left with no choice but to close their business which would be decided in their upcoming meeting and the government would be responsible for the consequences, they added.
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