Karachi: The Korangi Association of Trade and Industry (KATI) President, Junaid Naqi, has praised the federal cabinet's decision to renegotiate contracts with 14 Independent Power Producers (IPPs), describing it as a transformative measure for stabilizing Pakistan's economy. This decision, he says, provides critical relief to industries by reducing electricity rates by Rs10 to Rs11 per unit, thereby alleviating the burden of rising production costs.

According to a statement by Korangi Association of Trade and Industry, the renegotiation is expected to save Rs1.4 trillion, an effort aimed at correcting inefficiencies within the energy sector and addressing the increasing circular debt. Naqi highlighted that high utility costs have consistently weakened the competitiveness of Pakistani industries, both domestically and internationally. The reduction in energy costs, he believes, will enable manufacturers and exporters to reclaim their market positions through affordable and reliable energy supplies.

Naqi also acknowledged the anticipated annual savings of Rs137 billion resulting from these revised agreements. He urged the government to invest these funds into industrial development, infrastructure projects, and economic recovery to maximize their benefits.

In addition, the KATI president commended the government's initiative to merge certain ministries and divisions, such as integrating the Ministry of Anti-Narcotics into the Ministry of Interior and combining the Aviation Division with the Defense Division. He described these reforms as crucial for streamlining bureaucratic structures and reducing administrative expenses, which have historically strained national resources.

The fiscal savings from these mergers, amounting to millions of rupees annually, demonstrate the government's commitment to fiscal discipline and reform, Naqi noted. He emphasized the need for transparency in the allocation of these funds to ensure they contribute effectively to national progress.

Finally, Naqi stressed the importance of continued collaboration between policymakers and the business community to ensure future reforms meet the needs of the industrial sector. He expressed optimism that these decisions would create a more competitive and sustainable economic environment in Pakistan.