May 26, 2002	Sunday	Rabi-ul-Awwal 13,1423

KARACHI, May 25: The rupee appreciation against the dollar by seven per cent since July-May 2001-2002 has caused a price fall in power generating equipments by 10-15 per cent.

According to a market survey, the price of 2 kva generator has now declined to Rs32,500 from Rs38,300, while the a 5 kva generator can now be purchased at Rs87,000 as against Rs102,000. A 40 kva generator is now priced at Rs660,000 as against Rs750,000.

However, the price fall in power generators has failed to lure many buyers in the markets and imports of power generating machines have also been showing a declining trend.

President, Karachi Machinery Merchant Group (KMMG), Sikandar Shahzada, said that buyers were not turning up to the markets despite continuous fall in prices. He said rising cost of utility bills and other daily expenses could be attributed as main reasons for making buyers reluctant to own a generator. Otherwise, the loadshedding problems have been deteriorating day by day.

As a result of shrinking buying power, people have started switching over to buy reconditioned generators that are being imported from Singapore, Japan and Dubai. These second-hand soundproof generators are very cheap in prices as compared to new power machines. For example, a 200 kva reconditioned generator can be purchased at Rs400,000-600,000 depending on the condition, while a new generator costs Rs1.5 to Rs1.6 million of same kva. The entry of reconditioned generators has caused a stir in the market as these are being brought in Pakistan by declaring as scrap by the importers.

Since the demand of new generators has declined and consumers are shifting to install reconditioned generators, Karachi generator market has now got only seven to eight main importers as compared to 20-25 a year back, Shahzada said.

According to the Federal Bureau of Statistics (FBS), import of power generating machines declined by 60 per cent to $9.5 million in April 2002 as compared to $24 million in April 2001. A 12-per cent decline in imports was also recorded in July-April 2001-2002 to $148 million from $170 million in the same period of 2000-2001.

“A little hope has now emerged for genuine importers since some demand has emerged after calm prevails in war-torn Afghanistan,” he said, adding that some NGOs operating in Peshawar had started giving orders to “us after getting orders from Afghanistan”. “We have already started opening letters of credit (L/C) to meet the NGOs’ requirement,” he added.

Power generators used by domestic consumers range between 2 kva to 5 kva, while above 30 kva generator category is used by the industrialists.

On the industrial front - majority of industries have already made arrangements of stand-by generators to avoid production losses and meet export commitments on time. Some industries, mainly big export houses, have also made arrangements of installing captive power generation units instead of depending on the KESC.

“The demand of generators has declined as majority of units have already made standby arrangements in the last two to three years,” vice-chairman, F.B. Area Association of Trade and Industry, Farooq Bakali, said.

He said the number of industrialists using captive power generation was low but it would increase in times to come. In F.B. Area, majority of industries out of total 1,500 units, have got a stand-by power generators that can run for four to eight hours in case of loadshedding. But very few of them have captive power generation units.

Korangi Association of Trade and Industry chairman Farhan-ur-Rahman said that majority of export houses had installed stand-by power generators, besides large number of units had their own power generation system.