All Pakistan Textile Mills Association (APTMA) on Friday demanded immediate withdrawal of the 39 per cent increase in the fuel adjustment price determined by the National Electric Power Regulatory Authority (NEPRA) as it would lead to the massive closure of the industrial units.
Chairman APTMA Mohsin Aziz in a statement urged the Prime Minister Yusuf Raza Gilani and Minister for Water and Power Syed Naveed Qamar to withdraw the decision of NEPRA. He said such deduction would put textile industry into a financial crunch, as APTMA estimates that a mill with consumption of 70,000 to 100,000 units per day is supposed to bear an additional impact of Rs7 to 10 million. If implementation it would lead to massive closures of industrial units which are already faced with energy shortages and financial crunch due to high bank mark ups.
He said charging of FAS by over Rs3 per unit is excessively high and the worst part of the decision is that it is meant for the month of August 2011 with retrospective effect. He lamented that the textile industry had already affected sales and realized proceeds on agreed cost factor and it would be impossible to retrieve it from the customers. He said it would be taken as negation of good business practices both inside and outside country. He said even the government would not be able to come up with a practical mechanism as to how the FAS can be recovered from the customers and then paid to the concerned DISCOs.
Chairman APTMA said the textile industry was already on the brink of collapse with no liquidity available to meet its expenses and deduction of additional amount from mills under the FAS would bring total closure of industry. No textile mill is in a position to pay such huge amounts and any power supply cut from DISCOs would pave the way for bank defaults across the country. He said textile industry is an export-oriented industry and it could not pass on this additional burden against already materialised transactions. The textile industry is highly energy intensive and is faced with six hours a day load shedding and gas supply is also restricted. He expressed the hope that sanity would prevail in government circles and the Prime Minister would direct the authorities concerned to withdraw the decision to protect jobs of millions of workers.
