A total number of 1,579 industrial units have been closed down during the last five years across the country for various reasons including financial problems. According to sources in the Ministry of Industries and Production all Provincial Governments and Export Processing Zones Authority (EPZA) were requested to provide details of all closed down industrial units along with number of workers rendered jobless.
The sources said that all provincial governments and EPZA have furnished requisite information to the ministry of industries and production. As per the statement of Governments of Punjab, Sind, Khyber Pakhtunkhwa, Balochistan and EPZA a total number of 1,579 Industrial units have been closed down in the country during the last five years, the sources added.
Giving break-up of the halted industrial units across the country, they said that in Punjab 115 units have come to a halt during the period, 700 units in Sind while in Khyber Pakhtunkhwa, Balochistan and EPZA, 688, 29 and 47 units have stopped operating. They added that Government of Sindh, Khyber Pakhtunkhwa, and Balochistan have not indicated closure of these industrial units. However, while indicating the reason for closure of these units, Government of Punjab has stated that beside change of ownership and ownership disputes, major reason was financial constraints. They added that 10 units have been closed down due to restriction of 80:20 exports Ratio (80 per cent export abroad and 20 per cent with in country). As far number of workers rendered jobless is concerned, Government of Khyber Pakhtunkhwa and EPZA have provided the information. Governments of Punjab, Sindh and Balochistan have stated they have no data of such workers. As per statement of Government of Khyber Pakhtunkhwa approximately seven thousand whereas as per EPZA’s statement five hundred thirty (530) workers became jobless due to closure of industrial units during last five years.
The sources said that the new industrial policy is addressing the issues that have led to closure of the units and formulating measures to revive the closed units if found viable. In any business firms survive due to a variety of reasons however in relatively efficient markets the productive capacity of failed firms is acquired by others. In Pakistan due to difficulties in liquidation of businesses a huge amount of productive capacity lies dormant at any point in time. The government is endeavouring to institute a more transparent and efficient system to help distressed firms get out of business quickly and at a minimal cost. The Ministry of Industries has also recommended that changes to the bankruptcy laws be made to make it easier for businesses toacquire distressed firms. It further recommended that the transition and exchange of hands in business will be made swifter under these legal revisions. The ministry also supports the Corporate Rehabilitation Act being developed by SECP that ensures the possibility of providing technical support in reviving the sick industry and units in the country.
