Karachi: The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has urged the federal government to declare an industrial emergency, warning that the nation's manufacturing sector is on the verge of a collapse. The appeal, led by FPCCI President Atif Ikram Sheikh, highlights the urgency of addressing energy tariffs, interest rates, and taxation policies that hinder the competitiveness of local industries.

According to FPCCI, the current industrial climate, marked by high electricity costs and restrictive fiscal measures, is stifling the growth of Pakistan's manufacturing base. Mr. Sheikh criticized the government's incremental relief packages, noting that industries continue to face high electricity tariffs of PKR. 34 - 35 per unit, contrary to the promised PKR. 22 per unit. He emphasized the need to reduce income tax rates and gas tariffs to enhance export competitiveness.

The FPCCI president also pointed out the disparity in electricity costs, with Pakistani exporters paying 12.5 cents per unit compared to 6 to 9 cents in neighboring countries like India, Bangladesh, and Vietnam. This disparity, he argued, is driving de-industrialization and capital flight from Pakistan.

S. M. Tanveer, Patron-in-Chief of the United Business Group, echoed these concerns, citing the existential challenges facing the textile sector, a key contributor to Pakistan's exports. He called for a reduction in the policy interest rate and proposed a comprehensive recovery framework, including immediate policy interventions by the Special Investment Facilitation Council.

Both Mr. Sheikh and Mr. Tanveer stressed that without decisive action, including a shift to a take-and-pay model for power producers and reductions in electricity tariffs for exporters, Pakistan risks an irreversible economic downturn marked by increased unemployment and loss of foreign exchange.