‘Hike in power tariff to leave adverse effects on economic activities’

ISLAMABAD (PR): Businessmen in a meeting at Islamabad Chamber of Commerce & Industry strongly condemned the reported 43 paisa per unit increase in electricity tariff by the government from October 2014 under IMF pressure and termed it a highly unjustified move that would badly hurt the economic activities and put more pressure on the already overburdened common man.

Addressing the meeting, Muzzamil Hussain Sabri, President, Islamabad Chamber of Commerce & Industry said the government has already collected over Rs.70 billion from the consumers in the form of recent massive overbilling and urged that it should immediately withdraw all unjustified charges from the power tariff to provide relief to the general public and to bring down the cost of doing business in the country.

He said hike in power tariffs always brought more problems for the economy and instead of taking such anti-business and anti-growth measures, government should take urgent measures to reduce the transmission & distribution losses, control power theft and bring transparency in the working of power companies to improve things. He said government should also focus on enhancing the share of hydro power in energy mix to produce cheap electricity as hydro power was costing just Rs.0.08/kWh compared to Rs.18.25/kWh of furnace oil.

Muzzamil Sabri said that the power tariffs in Pakistan were already highest in the region due to which cost of doing business had gone very high and industrial growth suffered badly. In such circumstances, making more increase in the electricity tariff was tantamount to discourage growth of business activities and new investment in the country.

He said energy prices were highly correlated to the economic growth rate as affordable tariffs give boost to business and industrial activities, but higher tariffs in Pakistan led to the stagnation of industry, increased production cost, hiked inflation and pushed up the prices of finished goods making Pakistanis exports very uncompetitive. He government should give due consideration to these facts and avoid making any further increase in power tariffs.

He said electricity consumers in Pakistan have to pay for the inefficient and poor performance of power companies because government tended to include transmission & distribution losses, power theft, debt servicing costs of power companies, development surcharges and many other charges in the power tariff which was highly unjustified and a great injustice to the consumers and urged that government should streamline the power sector affairs to facilitate the growth of industrialization and economic activities.

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