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Karachi Businesses Unite in Protest & Shutter-Down Strike Against Surging Power Bills

Date: September 01, 2023

Karachi, Pakistan’s economic hub, is on the brink of a significant economic protest as industrialists, traders, and shopkeepers unite to demand relief from the burden of soaring power bills. With the caretaker government yet to announce measures to alleviate the crisis, businesses across the city are gearing up for a shutter-down strike scheduled for Friday.

In a remarkable show of unity, the Karachi Chamber of Commerce and Industry (KCCI), the city’s premier trade body, has issued a strike call, receiving unwavering support from its diverse membership, ranging from major corporations to small-scale traders. KCCI leader Zubair Motiwala announced this decision following an extensive meeting that saw participation from hundreds of members, both physically and virtually.

Representatives from all seven industrial zones in Karachi, including areas like Korangi, Landhi, Super Highway, SITE, and SITE Super Highway, have pledged their full support to KCCI’s cause. Furthermore, representatives from trade bodies, including those from Tariq Road, Aram Bagh, and the gold saraf market near Tower, have joined the movement.

Significantly, even while abroad, Sindh Governor Kamran Tessori engaged in an online meeting with KCCI leadership, assuring them of his commitment to raise the issue of inflated bills with the government. He pledged to seek a viable solution upon his return to the homeland.

Despite Caretaker Prime Minister Anwaarul Haq Kakar’s directive for his team to find a solution within 48 hours, these efforts did not yield a viable remedy. Subsequently, Caretaker Finance Minister Shamshad Akhtar stated that reducing utility bills wasn’t feasible due to Pakistan’s engagement in an International Monetary Fund (IMF) $3 billion loan programme, preventing the provision of subsidies and concessions to power consumers.

Recalling recent events, the surge in power bills followed the government’s decision to increase the electricity base tariff by up to Rs7.5 per unit effective from July 1, 2023, as per IMF loan conditions. This tariff hike was intended to address the growing circular debt, although critics argue that it could exacerbate the issue rather than alleviate it.

Sindh Energy Department Secretary Abu Bakar Ahmed recently revealed that the cost of power production has soared to Rs72 per unit, a staggering increase from a mere Rs28 per unit just two years ago. This dramatic rise is primarily attributed to the reliance on one of the most expensive fuels – residual fuel oil (RFO).

In the view of the business community, there exists an alternative path for resource mobilization, focusing on expanding the taxpayer base, curbing line losses and power theft, and discontinuing exemptions. These measures could effectively narrow the fiscal deficit without exacerbating the financial burden on citizens through increased power tariffs.

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