The Pakistan Textile Council (PTC), which represents 30% of Pakistan’s Textile export earnings, expresses its grave concerns over the Economic Coordination Committee’s (ECC) recent decision to increase the gas tariff for Captive Power Plants (CPPs) from Rs 3000 per MMBtu to Rs 3500 per MMBtu. This 16.7% hike is a severe blow to the textile sector, which is already grappling with mounting production costs and intense global competition.
The textile sector is the backbone of Pakistan’s exports, contributing 60% of total exports and directly and indirectly employing one worker. A direct increase in energy costs—specifically for CPPs, which provide a vital energy source for uninterrupted operations—will critically undermine the competitiveness of Pakistan’s textile exports in global markets.
This decision reflects a clear anti-export bias in the government’s policy framework, prioritising fiscal revenue over the sustainability and growth of export-driven industries. By imposing an additional burden on the textile industry, the government risks reversing the hard-earned gains in export growth and jeopardising its balance of payments position. With the highest energy costs, the highest cost of borrowing, the highest minimum wage, and the highest taxation, competing in international markets will become impossible for Pakistani textile and apparel exporters.
Fawad Anwar, Chairman of the Pakistan Textile Council, commented: “The ECC’s decision to raise gas tariffs for Captive Power Plants is deeply disappointing and short-sighted. Energy costs account for a significant share of textile production expenses. Such an increase will render Pakistani textiles uncompetitive on the global stage when the country should be aggressively pursuing export-led growth to stabilise its economy. This move sends the wrong signal to the export sector, discouraging investment and threatening job security for millions of workers in the industry. We strongly urge the government to reconsider this decision and engage with stakeholders to devise policies that support, rather than hinder, export growth.”
PTC emphasises that the textile industry is not just an economic pillar but a crucial source of employment and development for the country. Policies that disproportionately burden this sector are counterproductive to achieving national financial stability.
PTC calls upon the government to adopt a balanced approach by withdrawing the gas tariff hike for CPPs, continuing RLNG supply with ring-fenced prices, rationalising UFG, no cross-subsidies and developing a coherent long-term industrial energy policy (power – petroleum – gas) considering global competitiveness factors.
