March 20, 2008	Thursday	Rabi-ul-Awwal 11, 1429

KARACHI, March 19: With a steep rise in power bills despite massive electricity failures, the sale of energy saving lamps has increased tremendously, and they have taken over tubelights and bulbs because of their low power consumption.

The local market is now flooded with Chinese energy savers of different brands, offering a one year guarantee.

However, owing to increasing trend in prices for the last one-and-a-half years, it is feared that these bulbs may go out of reach of common man.

The high incidence of taxes and duties has also resulted in an increase in smuggling of these products.

Currently the share of smuggled saving lamps has surged to 60 per cent from 40 per cent last year. China maintains 99 per cent of the market share, both from smuggled means and legal imports. The smuggled items, it is learnt, arrive via Susat Border near Gilgit.

The wholesale price of a 24 Watt energy saving light bulb has surged to Rs110, from Rs60 to Rs70 one-and-a-half years back. The retailers charge between Rs120 and Rs135, and the prices vary from locality to locality.

According to Pakistan Electronic and Electrical Manufacturers Association (PEEMA), the country’s annual power consumption is increasing at a rate of 10-15 per cent. The current requirement is 1,6000 MWs while the production stands at 10,000 MWs only.

“The country can save 1,000 MWs by using one million energy savers every year,” said PEEMA chairman Abdul Khaliq Jafarani.

“Massive use of energy saving bulbs can help save up to 80 per cent of electricity. If the government cuts the 10 per cent import duty to zero on these lamps and brings the 15 per cent sales tax to zero level, it will cut prices, besides curtailing their smuggling,” said the PEEMA chairman.

“Although energy savers are widely used in urban areas, they are yet to gain popularity in rural areas because common man and the poor cannot afford to buy them because of their rising prices,” he maintained.

In Karachi alone, he said, some five million energy saving bulbs are sold, and the whole country consumes around 480 million savers every year.

He said around 480 million energy saving bulbs are sold every year in the country and Karachi’s share is five million bulbs.

“The government eats up Rs40 in terms of duties and taxes on import of energy saving lamps,” said Mr Jafarani.

In his pre-budget proposals to the government, the PEEMA chairman said many countries have encouraged their people to use energy saving lamps by introducing various policies.

The United States has given incentives on import of energy saving lamps by returning the customs duty and by also paying value of goods to importers so that they can offer the product free of charge to their consumers.

He said genuine importers are facing another problem. “The provision of Section 25A of the Customs Act 1969 empowers the Customs officials to determine value of imported goods,” he said.

“This Act is being applied arbitrary without any valid reason as the Customs authorities determine value without considering the basic essential criterion. The value is being fixed on the exorbitant side which opens a floodgate of corruption,” he said.

“The Act is neither in the interest of Federal Board of Revenue from revenue point of view, nor in the interest of importers. The Section 25A hampers smooth clearance of imports, resulting in holding up of consignments and incurring heavy demurrages,” he said.

The PEEMA chairman said that the Section 25A has been inserted against the spirit of the WTO which is precise and clear.