THIS is with reference to the editorial ‘Decision on gas’ (Feb 1), which stated, among other things, that “this is a step in the right direction”, that “most captive power plants are highly inefficient and the diversion of the ever-depleting gas resource to them for self-generation is a big national loss”, that “the argument that the disconnection of gas to captive power will hit exports doesn’t have a leg to stand on”, and that ‘it is time for industry to stop seeking rent.”

I found these statements sweeping and having been penned without a fuller understanding of the issue’s dynamics. This surely needs to be put in the right perspective.

As a responsible member of industry, I fully respect the need to preserve national interest. However, it is hard to understand how we can manage to run these “highly inefficient” captive power-generation units, and still be significantly lower in total cost per KWH than the tariff charged by K-Electric. The fact is that our cost per unit will go up by about 50 per cent when forced to switch from our own power to the grid.

Besides, the grid is infamous for highly unreliable power supply and voltage spikes that cause havoc with the equipment that we need to run on a round-the-clock basis round the year.

Besides, it is difficult, if not impossible, for people to even imagine what it takes to run an industrial organisation in our environment, especially ones operating in a heavily-skewed buyers’ market where they are held to first-world standards in terms of quality, service and delivery by customers who have their pick of alternative suppliers in places like China, Vietnam and Cambodia. Pakistani exporters need to be far ahead of the pack in order to attract business away from these countries.

It is a pity that we are called ‘rent seekers’ when we seek to ensure consistent, reliable and cost-effective inputs, such as gas, power, water, law and order, and basic infrastructure amenities so that we may continue to compete with the best suppliers out there in the global market.

During the few minutes it took me to write these few lines, the KE power at my home has come and gone twice. By the way, using diesel power generators as backup for such disruptions will see our cost per unit exceed one hundred per cent of the current cost!

None of us want or seek undue subsidies to remain successful in our chosen field of expertise. We can compete and win on our own merit. All we seek is the provision of a consistent policy framework that does not cause whiplash by its sudden U-turns, and a long-term view by the government for a sector that generates employment for millions of our youth.

For a country with the fifth largest population in the world, a median age of 22.5 years, and one of the largest cohorts of un/semi-skilled youth, I would put this at the top of any national-interest agenda.

Nizar N. Mohammed

Karachi

Published in Dawn, February 7th, 2021