Govt ends subsidy on electricity bills for textile industry

LAHORE: The federal government has issued a notification to end its rebate on electricity bills for the export textile industry in January 2020, sources said.

According to details, earlier on the directions of Prime Minister Imran Khan an exempted were given on electricity bills for the export textile industry to increase exports.

After the relaxation, Rs 11.70 was being charged per unit. The textile industry now has to pay Rs 20 percent per unit as ending relaxation on electric bills. While, textile exports increased 36% after the fall in electricity prices.

The government’s move has threatened the closure of textile industries. Long electricity and gas load shedding has already caused the crisis in the sector and the current move will create further problems.

Textile and garments are considered the most important sector of Pakistan’s economy and the largest industry with a 46% share of total manufacturing. Accounting for 67% of exports, employment for 40% of the workforce and a 10.20% share in GDP confirms the importance of this sector.

According to the Pakistan Economic Survey 2018-19 analyzed by Gallup Pakistan, in 2018-2019, Pakistan’s largest export industry was the textile industry, with hosiery and readymade garments contributing 544 billion PKR/3.47 billion USD to total trade.