‘Hike in power tariff to slow down businesses’

KARACHI: The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) on Wednesday slammed a government decision to hike power tariff by Rs7.5/kWh, saying the decision would make businesses uncompetitive.

“We have already become uncompetitive vis-à-vis regional and sub-regional countries; due to the grossly-unfavorable cost of doing business environment in the country and there is no way we can absorb the added burden,” Irfan Iqbal Sheikh, FPCCI chief, said.

Sheikh stated that businesses were already paying close to Rs60/kWh – when accounted for all billing components, i.e. base tariff, surcharges, sales tax, income tax, excise duty, fuel adjustment charges and fixed charges.

“Now this massive increase will bring the business, industrial, and commercial activities to a complete halt,” he said.

FPCCI chief maintained that rather than burdening the regularly paying consumers of electricity the government needed to curb electricity theft and control line losses as it would plug leakages from the system and generate revenues for the government.

Sheikh informed that FPCCI was in pressure from its member bodies, association, and chambers to negotiate with the government on their behalf and persuade the withdrawal of the latest hike. “I hope that the better sense will prevail,” he said.

FPCCI president explained that cost of electricity results in a multiplier effect through increasing the cost of doing business at every stage – from production to the delivery to the end-consumer.

“IMF itself has recently admitted that Pakistan did not receive adequate aid in the aftermath of the most devastating floods of its history, why is government still not being able to present their case?” he questioned.

Shiekh urged Prime Minister Shehbaz Sharif and Finance Minister Ishaq Dar to immediately start a consultative process with the business community to ensure ease of doing business in the country.