FAISALABAD: The bonanza sales season for textile exporters may turn into a lost opportunity this year, as the government plans to cut gas supplies to the sector in the winter season, increasing reliance on expensive alternative fuels, which will make them uncompetitive in international markets.
Christmas and New Year occasions offer big opportunities to the textile sector but, like the previous year, the industry will again struggle to achieve its targets.
For the last two years, textile exports have remained below $14 billion and the share of Faisalabad remains stunted at $6 billion. The exporters remain unable to increase their sales despite enjoying duty free access to European markets under the Generalised System of Preference (GSP) Plus scheme.
“The acute shortage of gas in upcoming months will definitely disturb the Christmas and New Year orders,” said the industrialists. The government has planned to cut gas supply to the industries in Punjab for three months from November 1.
International buyers have apprehensions that their orders may be delayed due to energy shortages.
“Few years ago, buyers would come to Pakistan to book their orders but now the circumstances have changed and they do not see Pakistan as their first choice country,” said Raheel Salamat, a leading garment exporter.
Crescent Group of Industries Director Naveed Gulzar said the exporters in Sindh are better placed since they avail gas supply throughout the year.
Chenab Group of Industries Chief Executive Officer Mian Latif said the industrialists are paying an average of Rs14 per unit for electricity, whereas the diesel generator cost Rs25 to Rs30 per unit, which is unaffordable.
Few manufactures have installed heavy generators and steam plants (powered by coal) but many of the industrialists cannot afford these plants.
Published in The Express Tribune, October 24th, 2015.