Pakistan Industrial and Traders Associations Front (PIAF) has rejected the massive increase in gas and electricity rates as a result of an agreement with the International Monetary Fund after approval by the federal cabinet. According to the notification, the government has increased the price of gas to be used for fertilizer sector by 62 percent while 31 percent increase has been made in the price of gas to be used as fuel by zero-rated industry, general industry, power, cement and captive power plants, CNG stations and commercial consumers, putting an additional burden of about Rs397 billion during new fiscal year.
PIAF former chairman Irfan Iqbal Sheikh said that the cost of doing business has been already increased manifold, leading to constant decline in exports and high trade deficit. Electricity prices have been increased by Rs1.50 per unit and gas prices by up to 168.36 percent. He said that it is unfortunate that the decision to seek an increase in gas tariffs came at a time when Pakistani rupee has taken a plunge in open and interbank markets.
PIAF chairman Mian Nauman Kabeer said that last year, the government had ended subsidy on gas prices and increased gas prices by up to 143 percent by creating six new slabs. Though the government at that time had claimed that it would not put a burden on domestic consumers as the increase in gas tariff mostly affected the commercial entities, the domestic consumers were also on the receiving end of the hike, He said that PIAF had been calling on the government since long for the introduction of much needed reforms in the energy sector but unfortunately all its appeals had fallen on deaf ears with the result of huge cut in country’s economic growth.
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