ISLAMABAD, November 2024: Industrialists across Pakistan are urging the government to reconsider its decision to suspend gas supply to captive power plants (CPPs), warning that the move could lead to the shutdown of over 1,300 factories.
They further warned that the move will displace more than three million workers, and trigger a severe economic crisis. The suspension is set to take effect on January 1, 2025.
Fawad Anwer, Chairman of the Pakistan Textile Council, raised alarm about the potential impact of the government’s decision on industries that rely heavily on gas-powered CPPs for electricity.
Read More: UNI International felegation meets secretary of Industries, Commerce govt of Punjab
He explained that many industrialists have made significant investments in these plants, which operate at 70%-75% efficiency, far higher than the efficiency of government-run power plants, which operate at only 30%-40%.
Anwer criticized the lack of a clear plan for replacing the gas supply, pointing out that K-Electric (KE) in Karachi does not have the capacity or infrastructure to provide reliable power to industries.
He said that large exporters seeking to switch from gas to KE’s grid are often told they must wait up to two years for a connection and invest millions of rupees to upgrade KE’s infrastructure.
He also questioned the fairness of continuing to subsidize gas for domestic and fertilizer sectors while burdening the industrial sector with this sudden policy change.
Anwer further emphasized that such a large-scale transition typically requires years of planning, noting that the industry has no backup power infrastructure in place.
He called on the government to engage in serious discussions with industrialists to create a viable alternative.
The Landhi Association of Trade & Industry (LATI) also expressed strong opposition to the decision. Siraj Sadiq Monnoo, former president of LATI, described the suspension of gas supply to CPPs as a “poorly planned policy shift.”
Also Read More: Thar Coal Can Cut Gas Costs by 60%
Monnoo warned that the abrupt move would lead to a significant decline in industrial output, particularly in large- and medium-scale industries.
He pointed out that many CPPs either lack a direct connection to the national grid or only have partial access, making it difficult to transition to alternative power sources.
Muhammad Jawed Bilwani, President of the Karachi Chamber of Commerce & Industry (KCCI), voiced similar concerns.
He warned that the decision to suspend gas supply to CPPs, reportedly made under pressure from the International Monetary Fund (IMF), would have devastating effects on the industrial sector, leading to job losses and a sharp decline in exports.
