KARACHI: Diamond Industries Ltd said on Tuesday it’s suspended manufacturing operations until further notice because of adverse economic conditions and non-availability of imported raw materials.
The maker of foam, foam products and chemical binders used in textile, leather and wood industries said it’ll resume production once raw material becomes available. The government has made it difficult for industrial units to import raw materials as it’s battling a severe shortage of dollars. The authorities are trying to minimise the outflow of dollars by restricting imports of all kinds — a move that’s resulting in industry-wide production shutdowns.
Diamond Industries follows Crescent Fibres Ltd, which recently announced a production reduction of up to 50 per cent owing to widespread demand destruction. Earlier, Suraj Textile Mills Ltd, Nishat Chunian Ltd and Kohinoor Spinning Mills Ltd also announced production cuts partly because of a high operational costs and low demand.
The industry-wide production halts are reflective of a rising cost of doing business locally coupled with unfavourable conditions that are prevailing in the global market.
Analysts believe the decision by the central bank to restrict the imports of industrial inputs for saving dollars is counter-productive, especially because imports of consumer items are still taking place in one form or another.
Published in Dawn, January 11th, 2023