Hyderabad, (Parliament Times) : Muhammad Farooq Shaikhani, President, Hyderabad Chamber of Small Traders & Small Industry (HCSTSI), has voiced grave concerns regarding the government’s negligence in handling the contracts with Independent Power Producers (IPPs). He highlighted that, despite numerous demands and protests, the government’s failure to either cancel or reschedule these contracts has plunged the business community into severe difficulties.
Shaikhani pointed out that each month, the exorbitant electricity bills are compounded by various taxes, including electricity charges, television fees, general sales tax, income tax, surplus tax, additional tax, retailer sales tax, and fuel price adjustments. These additional costs are exacerbating the financial strain on the public.
Furthermore, he revealed that payments to IPPs have surged by 33%, reaching Rs. 2.8 trillion in the new financial year, thus placing an extra burden on consumers. This year alone, the cost of electricity per unit has risen by approximately Rs. 5, resulting in an added expense of Rs 310 billion.
He stated that the escalating electricity prices are crippling industrial activities, leading to the closure of thousands of factories. Despite this crisis, the government persists in subsidizing IPPs and continues to make payments in dollars rather than terminating these contracts. Shaikhani emphasized that these inequitable IPP contracts and the dollar-based payments are placing a substantial burden on the Pakistani economy. Even power plants funded with local currency are receiving payments in dollars. According to NEPRA, 71% of the cost of power generation is being allocated to payments for IPPs, with a significant portion going to inactive power plants.
Chamber President Farooq Shaikhani expressed that the current situation has exacerbated Pakistan’s debt crisis to an unsustainable level and poses a severe threat to national security. Previously, citizens struggled to pay their household electricity bills, and now the business community faces the same issue with commercial bills. This has led to a significant disruption in business activities and a widespread disturbance in the entire business sector.
Shaikhani highlighted that the soaring energy prices and tariffs are the most pressing issue in the country, directly undermining industrialization. Despite a generation capacity of 45,000 MW, only 22,000 MW is being transmitted through the main lines, with consumers still required to pay for unused electricity. Additionally, he pointed out that 56% of the electricity price is being spent on capacity charges, with the government paying Rs. 2 trillion in this regard.
He urged the government to make a critical decision, whether to prioritize the interests of IPP owners or to safeguard the welfare of 250 million Pakistanis, who are already witnessing the shutdown of thousands of industries and numerous operations due to exorbitant electricity tariffs. Shaikhani warned that if immediate action is not taken, the escalating prices and mounting bills could overwhelm the entire economic system.