THE partial restoration of gas supply to textile factories in Punjab is but a small step towards the complete resolution of what has turned out to be a chronic energy shortage for the manufacturing industry in the province. The Economic Coordination Committee’s decision on Tuesday to allow the supply of 85mmcfd of gas to the export-oriented industry against its total need of some 450-500mmcfd means that factory owners will get the fuel seven hours a day to operate their captive power plants. This is just 30pc of their daily gas need, and the remaining requirement has to be met by electricity. The supply of gas can cut their production costs and is likely to result in additional export revenues of $1bn over the next three months to February.

This will be the first winter in three years that the industry will be receiving gas — diverted from power generation by the IPPs to industry — on a daily basis. It is a good initiative for the industry, but one that comes at a certain political cost to the government. The government will be forced to cut electricity supplies to domestic consumers or spend more money on furnace oil-based generation to avoid blackouts. But, at the same time, the decision will save a significant number of industrial jobs and prevent substantial production losses during the winter months. It has, thus, sent the right vibes to manufacturers and investors about this government’s seriousness to attempt to heal the ailing economy and has shown its willingness to take risks to help the industry boost its exports and create new jobs. By ensuring the supply of gas and electricity for their uninterrupted production operations, the government has virtually thrown the ball in the court of the large textile manufacturers and exporters. It is now for them to implement their part of the ‘agreement’ by reviving their now limited production capacities and by investing their efforts in expanding output to take full advantage of the wide-ranging trade concessions allowed to Pakistan by the European Union under its GSP Plus scheme. Their failure to do their part of the job could prove disastrous for the economy and the people.