Concern expressed over diversion of captive power generation gas to grid۔ TMA

Senior Vice Chairman Syed Usman Ali, alongside notable members of the Towel Manufacturers Association, expressed grave concerns regarding the adverse effects of the government’s anti-export policies on Pakistan’s export industry. The proposed decision to redirect gas from captive power plants to the grid is perceived as another setback for exports. The business community, particularly exporters, believes that such measures hinder economic growth, particularly in vital sectors like exports. While exporters have remained steadfast in supporting the government’s revenue targets, they emphasize the necessity of comprehensive planning and governmental support to enable them to contribute effectively to economic growth and foreign exchange earnings. The establishment of captive power plants arose from past challenges with load shedding, with significant capital investments made by entities. However, diverting gas from these plants increases production costs for exportable goods, rendering them less competitive in the international market. In comparison, Pakistan’s electricity tariffs exceed those of regional competitors such as India, Bangladesh, and Vietnam, making Pakistani goods less appealing to international buyers. This energy cost disparity is exacerbated by cross-subsidy mechanisms. Syed Usman Ali highlights the inefficiencies in the energy sector, particularly in pricing and policy anomalies, which have led to the proliferation of captive power production. The failure to integrate captive plants back into the system when new capacities were added has resulted in higher fuel costs. The proposed disruption to captive power generation and the transfer of a significant power load to the grid pose serious risks to the export sector. The current grid infrastructure may not be equipped to handle such a load, potentially leading to widespread electricity disruptions and breakdowns, as seen in the past. In conclusion, the business community urges the government to reconsider its policies and prioritize measures that support economic growth, particularly in export sectors, to ensure sustainable development and stability in Pakistan’s economy. He suggested to the government managers to facilitate / provide consultancy to the private sector to improve the efficiency of captive power generation.—PR