Industrialists Announce Shutdown on December 4 in Protest of Gas Tariff Increase

Industrialists Announce Shutdown on December 4 in Protest of Gas Tariff Increase

Karachi, November 30, 2023 – The industrialists of Karachi has announced a widespread shutdown of all industries on Monday, December 4, 2023, demanding the immediate implementation of the approved gas rates of 1350 rupees per MMBTU (Million British Thermal Units) by OGRA.

During a press conference held at the SITE Association of Industry, representatives from the industrial sector strongly voiced their opposition to the recent surge in gas prices and formally declared the shutdown as a form of expressing their discontent.

This marks the third press conference on the matter, attended by key figures such as President SAI Muhammad Kamran Arbi, Chief Coordinator Saleem Parekh, Vice Chairman Businessmen Group Muhammad Jawed Bilwani, SVP FPCCI Suleman Chawla, SVP KCCI Altaf A. Ghaffar, President NKATI Faisal Moiz Khan, Ehteshamuddin from KATI, Zain Bashir from Landhi Association, Shaheen Sarwana, President SITE Superhighway Association, Raza Hussain, President FB Area Association, and presidents/representatives of value-added textile associations.

Vice Chairman BMG Jawed Bilwani expressed that trade bodies from Sindh and Baluchistan are deeply troubled by the substantial hike in gas tariffs, making it economically unfeasible for industries to continue operations.

Bilwani emphasized that the business community appeals to the government to lower the gas tariff to Rs.1350 per MMBtu, a rate determined as the 100 percent cost of gas by OGRA, including approximately 22 percent profit for SSGC. Industries are willing to pay at this rate but oppose the subsidies provided to other sectors.

He stated that after conducting two previous press conferences at KCCI and NKATI, the business community will persist in raising its voice through media channels until the government fulfills their legitimate demand to reduce the gas tariff.

Bilwani announced the closure of all industries on December 4 (Monday) if the government fails to meet the legitimate demand for gas at Rs.1350/- MMBtu. He argued that the new gas tariff burdens industries with cross-subsidies for undeserving sectors like fertilizer, domestic, and power, demanding a fair gas tariff of Rs.1350 per MMBtu.

He highlighted the incongruity of providing gas to the fertilizer sector at a lower rate, despite its profitability and the receipt of subsidies, which is beyond comprehension.

President SITE Association of Industry Muhammad Kamran Arbi asserted that the new gas tariff is intolerable for industries, urging the government to bring it down to Rs.1350/- MMBtu as determined by OGRA. He called for a meeting with industry stakeholders to reach a consensus on gas prices, given that the current tariff surpasses manufacturing costs.

SVP KCCI Altaf A. Ghaffar emphasized that Karachi’s industries already face high manufacturing costs, urging the government to withdraw the gas tariff hike and bring it down to an acceptable level of Rs.1350 per MMBtu.

Chief Coordinator SAI Saleem Parekh emphasized the need for uninterrupted exports and warned of the economic impact of halting exports. He noted that SMEs are closing down, and large industries are following suit, appealing to the government to address the business community’s concerns promptly to avoid a complete collapse of Karachi’s industries.

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