Pakistani exports in peril, KCCI

01 Dec '07

4 min read

Mr. Mohammad Haroon Agar, Vice President Karachi Chamber of Commerce & Industry (KCCI) in a press statement issued has strongly resented and deplored the recent stern decision of Oil and Gas Regulatory Authority (OGRA) to increase gas tariff by 6.5% for all consumer categories throughout the country early next year.

He strongly condemned the decision and said that this decision will prove catastrophic for the entire export sector particularly textile sector, which has shown only one percent growth against the target growth of 7% during the July-October quarter of the current fiscal year.

He apprehended that the gas hike will bring further push to the already high cost of doing business which will have crippling and very negative impact on the performance of export sector, already exposed to a number of risks and challenges.

He cautioned forthrightly that if government was determined to implement gas tariff hike decision then more apparel textile and spinning units would be closed down as they would not be able to sustain the burden of very high cost of production in coming days and the GDP growth will suffer a setback, expected to be around 7.2% during current fiscal year, as envisaged by State Bank of Pakistan in its annual report 2006-07.

Mr Haroon Agar said that despite the fact that exporters have been continuously raising their voice against high cost of doing business and high utility charges, a further push in gas tariff will add further burden on to the shoulders of exporters.

While commenting on other problems and issues, he lamented that at this point in time Pakistani exports are already exposed to multitude problems and issues like rising gap in trade deficit as well as problems in the clearance of Research and development claims, backlog in sales tax refund, abolishment of safeguards on Chinese textile and clothing from the year 2008 by EU and USA and access of Vietnam to World Trade Organization, rising cotton prices and escalating prices of oil in international market are some of the factors that have been hindering the growth of the overall export earnings of the country.

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