Kazi Zahidul Hasan :
Business leaders have strongly opposed the government’s latest move to increase the tariff of electricity saying that the proposed hike would adversely affect the manufacturing sector.
“Any increase of power tariff will hit hard the industries. It will push up manufacturing cost eroding their competitiveness in the global arena,” M Shafiul Islam Mohiuddin, President of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) told The New Nation yesterday.
He added, “The impact will be severe on export-oriented industries.”
The FBCCI chief mentioned that local industries have already been hurt taking heat from various internal and external factors. Now they are trying to recover. At this moment, any hike in power and energy prices will severely dampen their recovery process.
“I urge the government not increase the price for at least two years,” he added.
Mohiuddin also said he sees no rationale for a fresh power tariff hike when the distribution companies failed to ensure uninterrupted power supply to the manufacturing industries.
Bangladesh Energy Regulatory Commission (BERC) recently held public hearing on power tariff hike proposals submitted by power distribution companies.
Stakeholders including consumers and industrialists have opposed the government move to increase bulk power tariff for distributors. They raised their voice against the power tariff hike.
“A hike in power tariff will hit hard local industries, particularly the small and medium enterprises (SMEs), steel re-rolling mills and textile sector as they consume huge power to run production. They face an average 8 to 10 per cent production cost hike if the proposed power tariff is implemented,” Abul Kashem Khan, President of the Dhaka Chamber of Commerce and Industry (DCCI) told The New Nation.
Moreover, it will increase the cost of doing business and hurt Bangladesh’s export competitiveness and growth of SMEs.
“It will also hinder local and foreign investment,” he added.
Kashem Khan also urged the government not to increase the electricity price considering interest of the industries as well as the country’s economy.
“I don’t think that there is any scope for increasing power tariff at this moment, as local industries are passing through a critical time,” Siddiqur Rahman, President of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) told The New Nation yesterday.
He said power tariff hike will negatively impact on the country’s ready-made garment industries by pushing up their production cost. It will erode competitiveness of the export-oriented apparel industries in global market.
“Production cost of apparel industries has already gone up by over 15 per cent in the recent past due to various reasons. A fresh power tariff hike will further raise the production cost posing making them vulnerable,” said Rahman.
“The knock-on effect will be severe on the country’s shipments,” he feared.
The BGMEA leader urged the government to keep the power tariff unchanged for garment industries to maintain their competitiveness.
