Faisalabad's industry is in crisis due to expensive energy, taxes. Wealth Pak

The sizing industry is facing a crisis due to high energy prices, taxes and actions in the name of environmental protection. 

Tuesday, December 31, 2024

Faisalabad (UrduPoint News - 31st December, 2024) The sizing industry, which is the backbone of the textile sector, is currently facing a crisis due to high energy prices, taxes and actions taken against various units in the name of environmental protection.

Sizing factory owner Shakeel Ahmed told Wealth Pak that those leading the way are well aware that factory owners are struggling to keep their heads above water, but instead of extending a helping hand, government authorities, especially the Federal Board of Revenue (FBR) and the district administration, are bent on forcing them to close their doors. He said that a few weeks ago, the district administration had started demolishing the establishments of sizing units and alleged that hazardous smoke was emanating from these units.

He said that this situation has put factory owners in a difficult situation due to which they are stopping production which ultimately led to delay in shipments for several textile mills. Government officials believe that the sizing sector is actually the backbone of the textile industry as it produces beams used for weaving clothes.

He stressed that if the sizing units do not provide these beams for weaving, the rest of the textile sectors including processing, stitching, embroidery, packaging and others will be left high and dry. Aamir Sheikh, owner of a weaving and sizing unit, said that weaving units cannot operate even an inch without the help of the sizing industry, which is a preparatory stage in which yarn is coated for weaving. He said that the sizing sector is facing several challenges, which are creating significant financial problems for factory owners. He said that due to the current uncertainty in the country, garment orders are decreasing and there are huge fluctuations in the prices of raw materials and energy.

In such a situation, he questioned how factory owners can take the course. He lamented that we are in a worrying situation about running our business safely. He said that energy prices have increased dramatically in the last few years, which has increased our operational costs many times over. Similarly, we are facing alleged threats from the FBR and district administration. Textile exporters are hesitant to increase the prices of clothes as they are also facing stiff competition from countries like India, Bangladesh and Vietnam in the international market.

He said that these countries are getting electricity at concessional rates and their labor costs are also significantly lower. These advantages have given them a competitive edge over Pakistani exporters. He suggested that we have to develop a special policy for the industry to compete effectively in international markets. He said that electricity and gas are the lifeblood of the sizing industry. However, he fears that smooth supply of gas this winter will be a distant dream for us. If we opt for alternative energy sources to fuel our boilers, the district administration will crack down on us. Officials will immediately seal our units. How can we survive or grow in this scenario? Mohammad Zahid, a trader in the yarn market, said that political instability in Pakistan creates an environment where conditions are unpredictable for businesses. He noted that investors are hesitant to invest their money in the yarn market, which used to be a hotspot for investment. Earlier, sizing and weaving unit owners could obtain yarn on credit due to past investments, but yarn traders now do not extend this credit to most of these unit owners. He warned that this uncertainty is directly affecting the cycle of the textile sector, disrupting the ongoing process of production and sales.