Karachi, Muhammad Younus Dagha, Provincial Minister for Revenue, Industries, and Commerce, has called for a structural change in Pakistan's gas tariff policy. Speaking at a meeting at the Karachi Chamber of Commerce & Industry (KCCI), Dagha criticized the current system where industries subsidize gas costs for other sectors, contrary to global practices.
According to the Karachi Chamber of Commerce & Industry, Dagha emphasized the need for consultation with the business community to address energy sector issues. He advocated for a fair gas pricing policy where industries are charged for their gas consumption without cross-subsidization. This meeting, attended by Chairman Businessmen Group (BMG) Zubair Motiwala (via Zoom), KCCI President Iftikhar Ahmed Sheikh, and other dignitaries, focused on the challenges faced by the industrial sector due to high energy costs.
Dagha also addressed the lack of unity among Karachi’s industries, which he believes has muted their influence on government policies, particularly regarding energy crises. He compared this to the more unified voices in cities like Faisalabad and Lahore, resulting in more government attention to their demands. The minister assured that despite the provincial government’s limited mandate in energy matters, efforts would be made to facilitate meetings with relevant authorities for suggesting structural changes.
Motiwala, participating via Zoom, highlighted the decline in industrial performance since November 2023, evidenced by a 25% reduction in gas off-take. He criticized the 130% increase in gas prices, which he claims is detrimental to Karachi's industries, especially those dependent on gas. Motiwala argued that this hike was unjust, considering Karachi's significant contribution to the national economy.
The meeting also discussed the rejection by the IMF of a proposal to provide electricity at lower rates during winter for incremental consumption. Motiwala expressed disappointment, stating the proposal was beneficial for the economy and would have helped address the circular debt issue.
KCCI President Iftikhar Ahmed Sheikh noted the dire state of Karachi’s industrial infrastructure and the adverse effects of gas supply suspension and high energy tariffs on industrial performance. He stressed the need for immediate government attention to prevent further economic downturn.
The discussion at KCCI highlighted the urgent need for a revised energy tariff policy and governmental support to address the challenges faced by Karachi's industrial sector.