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Textile factories starting to close as they stop receiving gas

The situation is alarming for the textile industry which has made significant contributions to Pakistan's economy.

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Several textile industries across Punjab have been shut down amid the closure of the gas supply. Sui Northern said that the supply was suspended for two days, however, it still has not resumed.

According to the details, the gas shortage was created owing to a delay in the purchase of imported LNG. A spokesman for the Sui Northern Gas Pipeline Limited (SNGPL) confirmed to the media that gas supplied to captive power plants of the textile mills has been suspended.

Read more: Textile policy approved with amendments

On the other hand, the Oil and Gas Regulatory Authority (OGRA) has proposed a 45 percent increase in gas prices from July.

In addition to gas closure, the textile industry has also faced power cuts. The Lahore Electric Supply Company (LESCO) ended exemption to the industry while issuing a four-hour load management plan with effect from June 03, 2022. Important to note that it had previously claimed that it will provide an uninterrupted energy supply to the textile industry. However, it abandoned its policy for textile industries.

Textile industry’s contributions

The situation is alarming for the textile industry which has made major contributions to Pakistan’s economy. According to the data by the All Pakistan Textile Mills Association (APTMA), Pakistan’s textile exports surged 28 percent to $17.67 billion in July-May of this fiscal, the highest ever for the period under review, compared to $13.76 billion in the same months of last.

The APTMA data showed the exports of textile goods posted 59 percent growth to $1.69 billion in May 2022 against $1.06 billion in May last. APTMA also took a strong stance against the current crisis and urged the government to fully support the industry.

APTMA strongly urged the government to restore the priority of the export industry and to recognize the immense losses and damage to Pakistan’s economic future this will cause. A loss in production will lead to a further loss of exports and the need for billions of dollars in additional loans, which are already hard to come by.

Read more: Pakistan’s balance of payments crisis to worsen: APTMA warns

Moreover, former Energy Minister and PTI leader Hammad Azhar warned that the current problems facing the textile industry will lead to unemployment and subsequently ruin the economy.

“This will bring a wave of unemployment in the country and will cause a shortage of commodities and ultimately ruin the economy,” he said.