Echoing the collective concerns of the business, industry, and trade community of Pakistan, Irfan Iqbal Sheikh, President of FPCCI, has termed the latest Rs. 7.5 per unit hike in the electricity tariff as anti-business.
We have already become uncompetitive vis-à-vis regional and sub-regional countries due to the grossly-unfavorable cost of doing business environment in the country and there is no way we can absorb the added burden, Sheikh said in a statement.
He explained that businesses were already paying close to Rs. 60 per unit when accounted for all billing components, i.e. base tariff, surcharges, sales tax, income tax, excise duty, fuel adjustment charges (FAC), and fixed charges, and now this massive increase will bring the business, industrial and commercial activities to a complete halt.
Sheikh said that rather than burdening the regularly paying consumers of electricity, the government needs to curb electricity theft and control line losses as it will plug leakages from the system and generate revenues for the government.
He added that, as president of the apex body, he is under tremendous pressure from all 250 trade bodies, associations, chambers, and sectors to negotiate with the government on their behalf to persuade it to withdraw the latest hike. I hope that the better sense will prevail, he added.
He explained that the cost of electricity results in a multiplier effect by increasing the cost of doing business at every stage from production to delivery to the end consumer. He questioned why the government is still unable to present its case when IMF itself has recently admitted that Pakistan did not receive adequate aid in the aftermath of the most devastating floods of its history.
Sheikh said that the prime minister and the finance minister need to immediately take stock of the brewing frustration, defaults on electricity bills, impending bankruptcies and unfulfillment of the export orders and start the much-needed consultative process with the business community.