Punjab industry rejects new gas outage plan

Updated July 05, 2014

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LAHORE: The large-scale textile factories face complete shutdown of 10 hours a day owing to a change in the gas supply schedule for the captive power generation under the new government decision to divert gas to power plants to meet growing domestic and commercial electricity demand during night.

All Pakistan Textile Mills Association (Aptma) immediately rejected the new schedule, saying the association would defy the decision because it would lead to redundancies in Punjab where the industry was already struggling under massive energy shortages and high electricity prices.

Aptma has also called a meeting of its membership from Punjab on Monday to decide whether to close down the factories completely or launch protest campaign against the change in the schedule that will result in huge production losses and delay export orders.

The Sui Northern Gas Pipelines intimated the Aptma and other industry associations on Friday that it was changing the existing 8-hour a day supply schedule for the gas-based captive power and other gas-based industrial processes from 8pm-4am to 9am-3pm in order to secure gas for increasing power generation for the domestic and commercial consumers.

The old supply schedule had for about last one year helped Punjab’s large-scale industry to continue to operate by switching over to self-generation during the periods of power shutdown of 10 hours a day for the factories from 7pm to 5am.

Until now 58 large-scale textile mills without captive generation facility in Punjab faced complete closure of 10 hours every day on account of power cuts. Now the number of such textile factories is said to have increased to 270.

The 70pc of the total large-scale textile industry is located in Punjab. The rest is in Karachi and a little bit of it in Khyber Pakhtunkhwa.

Apart from the large-scale factories, small- to medium-sized textile and other industries, which cannot or do not have alternative self-generation facilities, were already experiencing one-third reduction in their production owing to power shortages.

“We have only one option: close down our factories, lay off workers and sit and watch the economy going down the drain,” an Aptma member from Multan told Dawn after an emergent meeting of the mill owners.

The new export numbers released by the Pakistan Bureau of Statistics (PBS) show that the country’s export of cotton yarn and fabric dropped 22pc and 36pc during April and May in proportion to energy shortages for the industry in Punjab. The textile industry normally exports yarn and fabric equal to 10 million bales of cotton.

“The decision to starve the largest export revenue earner and non-farm employer has come at a time when the new cotton harvest just about to begin,” a spinner from Lahore said.

He complained that the go­v­ernment had in Septem­ber last year exorbitantly raised the electricity prices, which had put an additional burden of Rs70-80bn on the industry in Punjab.

“The rise in power tariffs didn’t much affect the industry in Sindh and Khyber Pakhtunkhwa because of uninterrupted gas supply to the captive power there but created an uneven field for Punjab. Now it is shutting us down completely for 10 hours daily that will practically lead to the closure of two shifts. Who can work in this kind of environment?”

Published in Dawn, July 5th, 2014