Karachi, June 25, 2025 — The Korangi Association of Trade and Industry (KATI) has categorically rejected the Sindh government’s proposal to fix the minimum wage at Rs42,000, calling it economically unfeasible and damaging to the province’s industrial ecosystem.
KATI President Junaid Naqi voiced strong reservations against the move, stating that the proposed increase in minimum wage does not align with current macroeconomic conditions. With national inflation down to 6%, Naqi questioned the logic behind making Sindh’s minimum wage the highest in the country. He warned that this would incentivize industries to shift operations to provinces like Punjab and Khyber Pakhtunkhwa, where minimum wages range between Rs37,000 and Rs40,000, potentially triggering capital flight and job losses within Sindh.
He highlighted that even with the existing Rs37,000 minimum wage, the actual cost per worker exceeds Rs61,000 monthly when accounting for contributions to institutions such as EOBI and SESSI, overtime, bonuses, gratuity, and other benefits. In cases of extended overtime, this figure can rise to over Rs69,000, placing an unsustainable burden on Sindh’s industries and eroding their competitiveness.
Naqi criticized the province’s weak enforcement of labor laws, citing reports from SESSI and the Public Accounts Committee, which reveal that nearly 80% of Sindh’s industries do not comply with minimum wage regulations. He stressed that many workers—particularly in the informal sector—earn less than Rs30,000 a month while working long hours without proper benefits. This, he warned, not only breeds social inequality but also fuels unrest and undermines legally compliant businesses.
The KATI chief cautioned that without addressing enforcement gaps and building institutional capacity, any upward revision in minimum wage would disproportionately benefit non-compliant entities while further penalizing responsible employers. He called for a realistic approach, recommending a minimum wage between Rs38,000 and Rs40,000, consistent with national inflation and other provinces.
Naqi urged the Sindh government to delay the implementation of the proposed labor code until it guarantees worker protections and promotes a fair, enforceable, and sustainable wage system. He concluded by advocating for structured stakeholder dialogue to develop a balanced wage framework that supports both industrial growth and worker welfare.