KARACHI: Value-added textile industry leaders have urged the government to withdraw cess on gas of Rs100 per mmbtu on industries including captive power plants as proposed in the Finance Bill 2012, stating that the move will increase the cost of business and would affect Pakistan’s standing amongst regional competitors.

At a hurriedly called joint press conference held at the PHMA House on Wednesday, leaders of eleven value-added and ancillary textile industry said that utilities are never used as a tool for revenue generation, however the Finance Bill 2012 suggests that ‘huge revenue would be generated after the imposition of cess on gas’.

The leaders urged the government to ensure adequate gas supply at competitive price to value-added textile industry instead of resorting to frequent increase in gas prices.

Exports of value-added textiles have already gone down by 9.8 per cent whereas exports of regional countries like India have gone up by 23.87 per cent, Bangladesh by 7.86 per cent and China by 2.05 per cent, the leaders maintained.

“If the proposed cess on gas is allowed it will add to the cost of manufacturing which will ultimately push up the cost of end products of textile ancillary industry particularly when gas tariff in Pakistan is already higher by 183 per cent than Bangladesh. The move by the government will in fact give benefit to Bangladeshi manufacturers of value-added textile goods,” they said.

The impact of cess on gas tariff will be to the tune of 19 cents per cubic meter or 216 per cent higher than Bangladesh, they informed.

These leaders also asked the government to immediately go for the review of gas and energy policy.

They further said that the imposition of cess of Rs100 per mmbtu on industries has been done without taking the stakeholders on board.

“It’s alarming that exports of value-added textile sector throughout the year had been falling. However, last month they drastically declined by 25 per cent in quantity and 10 per cent value terms,” they leaders informed.