Traders walk out of dialogue with SNGPL authorities


FAISALABAD: Dialogues between SNGPL authorities and industrialists were aborted after the company turned down the traders’ demand to revise the weekly gas load shedding schedule from existing three days to two.
As the SNGPL issued the unchanged three days gas-holiday schedule on Saturday, the industrial sector representatives walked out of dialogues and announced to boycott the negotiations. The new schedule entails Thursday, Friday and Saturday as the load shedding days.
Pakistan Hosiery Manufacturers and Exporters Association (North Zone) Chairman Chaudhary Salamat Ali said that the government had backed out of its earlier commitment of two days load shedding which is now extended to three days. “It has resulted in the closure of 600 industrial units this week alone,” he added.
He said that the government was playing with the emotions of traders as well as workers who are losing their jobs. Pakistan Textile Workers Federation Chairman Abdul Qayyum said that the government was creating a law and order problem in the country by causing a deliberate mass unemployment in the country.
Industrialists and workers are equally pushed to the wall by the wrong policies, he added. Faisalabad,the second largest revenue generating city, has taken great strides in the last quarter of a century, but frequent load shedding of electricity and gas, high interest rates, shortage of raw material and substantial loss of cotton crop due to floods have contributed to the textile industry crisis in the once bustling city which is home to major textile manufacturing units of the country.
The situation led to the closure of more than 35000 power loom factories consequently laying-off many textile workers causing a large-scale unemployment and social unrest. The looming crisis has sent shock waves of caution among the businessmen who are losing revenue and clientele due to the recession period.
In this no-win situation for both sides (industry and government), the traders are compelled to scratch their old wounds by moaning about their other problems apart from the gas load shedding. An entrepreneur said that they wanted to tell the government that gas shortage was not the only problem in the textile sector, however, it had caused an overall state of nervousness and disappointment in the textile sector and the manufacturers were reluctant to take risk in the vulnerable market.
The crisis is emerging at a time when Faisalabad based business community was optimistic to increase the existing 10 billion US Dollars annual export target. But instead of the proposed increase, it is feared that this year export will fall short of the last year figures. It is pertinent to note that the exporters had challenged early this year that if the government provide them uninterrupted power and gas supply, they can double the annual export raising it to a record level of 20 billion USD which according to them is almost 3 times higher than Kerry Lugar Aid of 7.5 billion US Dollars to be granted in 5 years time.
A leading businessman briefed the predicament ‘as a serious threat to textile industry’. “Export of locally produced yarn to China has pushed the local manufacturers to the brink of collapse”, he said, adding that the government initially did not bothered to take action to control the yarn export thus causing a shortage of yarn for the local producers who were left high and dry in the face of this critical challenge. The move accelerated the decline in the local production due to sky-rocketing of yarn prices in the local market.
Pakistan has the world’s highest interest rate of 21 percent in the banking sector. A power loom entrepreneur says that during the reign of banker turned Prime Minister Shaukat Aziz banks were given wide concessions and privileges. “Small and medium sized investors are having tough time due to bank loans that are too difficult to be paid back due to high mark up” he protested. It is high time for banking market to realize that loans are issued to facilitate the business and they have to reconsider their policies and procedures in favor of investors.
Hard time is getting much harder in coming months due to loss of 25 percent of cotton crop in recent flooding in the country. “This may trigger a closure of many spinning and manufacturing units due to shortage of yarn”, said an official of a textile mills. Federal Textile Minister Rana Farooq Saeed who hails from Faisalabad but he is unable to redress the grievances and dissentions of textile entrepreneurs.
“It is because 15 per cent regulatory duty imposed on yarn export has failed to discourage the exporters”, explained a factory owner. “The Government must realize that if the mills and garments factories continue to close down, it will be followed by a widespread unemployment leading to crimes and extremism”, he added.
It is a high time for the authorities to intervene and put the textile industry back on track. The recommendations of textile traders include ban on yarn export and end of electricity and gas load shedding. Once it is achieved, the relevant issues of labour and manpower will be settled in the due course of time.
In a wide spectrum, cotton growers in Pakistan must be protected so that their yield might be increased to root out the local shortages in supply. Protection of cotton crop from virus through research and proper pesticides can surely multiply the cotton yields.