Leaders of the city’s business and industrial community have issued a stark warning that the government”s decision to suspend gas supply to industries for two days a week could inflict far-reaching and damaging consequences on Pakistan’s already fragile economy.
In a joint statement today, Chairman of the Businessmen Group (BMG), Zubair Motiwala, and President of the Karachi Chamber of Commerce and Industry (KCCI), Muhammad Rehan Hanif, described the move as “extremely alarming and counterproductive,” highlighting that the nation is already grappling with a severe economic crisis driven by the rising cost of doing business.
They pointed to the exorbitant prices of gas and electricity, which have significantly eroded the competitiveness of local industries. The repercussions of such policies are already evident, with Pakistan”s exports declining by 8.76 per cent in February. This downturn reverses a brief recovery, with export proceeds falling to approximately $2.27 billion and the country’s trade deficit widening to around $25 billion.
The business leaders emphasised that at a critical time when Pakistan needs to bolster exports, the gas suspension will severely disrupt industrial operations, reduce production capacity, and inevitably lead to delays or cancellations of international shipments. “Instead of supporting exporters and manufacturers, such decisions will only deepen the crisis being faced by industries,” they cautioned.
While acknowledging the government”s formation of a high-level Action Committee to address the energy situation as a “positive step,” Motiwala and Hanif stressed that the 18-member body would be incomplete without proper representation from the industrial and export community. They strongly urged for the inclusion of KCCI representatives, stating the business community is better positioned to provide practical insights and workable solutions.
The leaders noted that industries nationwide are already struggling with skyrocketing energy costs and unstable policies. They warned that the additional burden of gas suspension could force many factories to operate at minimal capacity or halt production entirely, resulting in massive financial losses, widespread worker layoffs, and a sharp decline in export volumes.
Motiwala and Hanif also highlighted a paradoxical gas management policy. They recalled that only a few months ago, discussions were held to defer imported RLNG cargo from Qatar due to reduced domestic demand. Concurrently, industries were compelled to use an expensive blend of indigenous gas and RLNG, with the RLNG ratio escalating up to 40 per cent, which significantly inflated energy costs.
This situation has led to a drastic decline in industrial gas consumption, as many factories have curtailed operations and shut down captive power plants due to unaffordable energy. According to industry analyses, gas tariffs for these plants have nearly tripled in recent months, making them uncompetitive compared to regional economies.
The business leaders referred to documented evidence that some domestic natural gas wells were capped due to a surplus of RLNG, raising serious questions about the sector”s planning. They noted reports indicating that gas production was restricted even as expensive imported RLNG continued to be purchased under long-term agreements.
Further supporting their claims of mismanagement, they recalled that SNGPL had previously raised concerns over falling gas consumption, cautioning that it could create operational and safety hazards. The gas utility had formally advised its suppliers to reduce system pressure to mitigate the risk of damage or rupture in the transmission infrastructure due to potential pressure build-up.
Instead of imposing disruptive measures, the government should focus on structural reforms within the gas sector, urged Motiwala and Hanif. They specifically called for tackling the persistent issues of unaccounted-for gas (UFG), line losses, and widespread pilferage, which cause immense financial losses to the national exchequer annually.
“Industries are the backbone of the economy and the primary drivers of exports, employment and revenue generation. Uninterrupted gas supply to industries must be ensured at any cost,” they asserted.
They concluded with a final warning that without an immediate reversal of the policy, exporters will face production delays, forcing international buyers to divert their orders to competing countries. The business leaders urged the federal government to review the decision, adopt a balanced, industry-friendly energy policy, and provide the necessary support to revive Pakistan”s manufacturing sector.