Approval will provide relief of Rs26 billion to industry
The textile industry is set to milk more money following the Cabinet
Committee on Energy’s (CCOE) approval of another package worth Rs26
billion for the industry by extending the Time of Use (ToU) tariff scheme.
On a summary of the Power Division, the CCOE approved the proposal of
“Extension of Time of Use (TOU) Tariff Scheme for Industrial Consumers”
from May 1, 2021 to June 30, 2022.
The package was originally approved in November 2020 and was set to
expire on April 30, 2021.
Sources told The Express Tribune that the government would bear a burden
of Rs26 billion due to extension of the tariff scheme for industrial
consumers.
The Power Division had sought approval of the energy committee for
allocation of a budget subsidy of Rs26 billion for industrial consumers from
May 1, 2021 to June 30, 2022 due to extension in the tariff scheme.
The industry is receiving gas supply at discounted rates. The textile industry
is a major beneficiary of the subsidy scheme.
The government had initially introduced the gas supply scheme at
discounted rate for the export-oriented industry. But later, the Petroleum
Division said that all industries, including those which were not exporting
textile products, were availing the subsidy.
The Petroleum Division also proposed that only the export-oriented
industry should avail the subsidy on gas supply. Interestingly, the textile
industry was not only availing the subsidy on gas supply but it was also
receiving electricity at discounted rates.
Moreover, the textile sector was receiving gas for its captive power plants.
The government had approved a plan for conducting audit of captive power
plants. But some textile industrialists obtained a stay order from court as
they were not ready for the audit of inefficient captive power plants.
The textile industry is also yet to pay cotton cess for conducting research on
cotton crop. It has obtained stay orders and is not ready to pay the cess.
Earlier, the government had prepared a policy under which only those
millers that paid the cess would be eligible for subsidy schemes. But under
the current government, the textile ministry has withdrawn this condition
for big textile millers.
The CCOE meeting was chaired by Federal Minister for Planning,
Development and Special Initiatives Asad Umar on Thursday.
The committee also took up another summary of the Power Division
wherein it was proposed that the National Electric Power Regulatory
Authority (Nepra) may be directed to withdraw the generation tariff and
licences awarded to category-III renewable energy projects as their
determinations were not consistent with the approved policies.
The CCOE referred the matter to the Law Division for legal opinion.
The Maritime Affairs Division presented a report on the progress on
establishing two new LNG terminals at Port Qasim, Karachi. The meeting was informed that the sub-committee, headed by the Ministry
of Maritime Affairs, was holding regular meetings to facilitate the setting up
of new terminals.
Source: The Tribune, India Saturday, 17 April 2021